EURUSD stays downside below the 1.1 handle. What should be expected next? The following includes the EURUSD Elliott wave analysis November 14 update.
November 14, 2019 | AtoZ Markets – EURUSD has dropped to the 1.099 minor support level and will most likely break below it, given more time. The geopolitical tension between the US and China resumed after President Trump’s Tuesday speech. EURUSD has now dropped to its lowest price in one month. The low momentum in the last two days ensures that the pair stays within the touching distance of the 1.1 critical level. A dip to 1.088 will most likely happen.
The market barely reacted to the upbeat German GDP data that ensured the country has escaped recession. The US-China trade deal has weighed in again and investors are back in the cautious mood. Reports from Beijing and Washington suggested that the talks have hit another barrier over farm purchases. Beijing wants to strike a deal that will give it leverage in case of a breakdown in talks. Meanwhile, President Trump admitted that talks are at advanced stages but he threatened new tariffs if there is a breakdown. Away from the US-China trade stories, Fed Chair Powell will continue his testimonies before the lawmakers today. After making three cuts since July, the US Central Bank sees very little need to cut interest rates according to Powell.
EURUSD Elliott wave analysis November 14 update
From the Elliott wave perspective, EURUSD is expected to decline below 1.088 to complete a bearish impulse wave that started in February 2018. In the last update, where we used the chart below, we expected the 5th wave to continue to retest 1.088 or even break below it to 1.075 (All the charts below are from TradingView)
The 5th wave of the bearish impulse wave from 1.255 is completing an ending diagonal. The chart below shows the sub-waves of wave (v) from 1.1175-1180.
The chart above shows how wave a-b-c of (v) could go. Wave a is not yet complete, we are expecting an impulse wave. We will probably see it decline to 1.095 before the wave b rallies toward the 1.1070. Around the 1.107 level, wave c might resume the bearish trend below 1.088. From the way it looks, new sellers will have to wait till the end of wave b. Unless a massive break above the channel upper boundary happens, EURUSD still has a bearish bias.