Recently we
were tracking a possible corrective decline from 1.3700 on EURUSD because of
the overlapping structure. However, sharp and extended fall through 2012
support line with a weekly and monthly close price beneath it forced us to
rework the count. In fact, we decided to check the line chart, where fall is
pretty clean and directional. Move can be counted impulsively which that’s s
bearish sign for the pair, but we expect a three wave bounce back to 1.3300 in
March, before downtrend extends.
EURUSD
daily- line chart
The reason
why we also turned bearish on EURUSD is the overlay chart below which shows
that most of other correlated markets turned lower, but not S&P which is
still bullish but alone. This could be a sign and S&P is approaching to its
top. If this proves correct and if S&P will turn lower from 1560-1600 then
USD will probably accelerate sharply which is already showing strength without
any S&P help.
Market
Correlations
