EURUSD Elliott Wave Analysis: Euro Stays Silent Ahead of the NFP

The Euro continues sideways below 1.14 as the market awaits a trigger to define the next direction. Ahead of today's NFP, the following looks at EURUSD based on Elliott wave theory.

December 07, 2018 | AtoZ Markets - Since dropping back below 1.1470, EURUSD is finding it difficult to break above 1.14 important price level. Fed chair Powell will speak today in Washington before the U.S employment data for November is released. The November employment data is expected to come at 198k, significantly less than October's (250k). The report often referred to as the Non-farm Payroll (NFP) reveals the state of the US labor market, unemployment rate and other details.

The Non-farm payroll often cause short term volatility on USD pairs especially if the outcome deviates largely from the expected data. NFP is expected to come at 198k. If the outcome comes at 150k or less, we will most likely see the dollar drop significantly (EURUSD should rally). On the other hand, if it comes at 240k or more, dollar should gain significantly (EURUSD should drop). What are the the important patterns emerging and levels to watch out for?

EURUSD Elliott Wave Analysis and Important Price Levels

After completing a bearish impulse wave at 1.1215, Euro gained quickly by nearly 200 Pips to 1.1470. Since then, price has remained downside and now sideways. The rally from 1.1215 was expected to continue to 1.2 from the long term perspective. With the current price behavior, it seems that might not happen though the short term direction is still upside. The chart below shows the emergence of a triangle pattern.

After the rally from 1.1215 to 1.147, price has gone sideways. It could continue in this range until a breakout happens. A break above, which is more likely, might see Euro rally to 1.155-1.16. A break below, which is less likely, might see Euro re-testing 1.1215. A break below 1.1215 will turn price back bearish. It will be interesting to know how today's NFP data release will fit into this structure.

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