close icon

Elliott Wave Pattern Sent EURUSD Higher, Not Trump or Cohen

What a week for EURUSD bulls! The pair is moving sharply up after weeks or even months of suffering. After opening at 1.1437 on Monday, the European currency climbed to almost 1.1623 against the U.S. dollar, before retreating to its current whereabouts near 1.1560.

It is interesting to note that Donald Trump’s trade war, which used to serve as an explanation for EURUSD’s six-month selloff from 1.2556, is now being mentioned as the reason for the pair’s recovery. In fact, EURUSD jumped the most right after Mr. Trump said the U.S. is going to impose a 25% tariff on every car from the European Union. Apparently, the FED is worried about the effects of tariffs on the American economy, which, in turn, puts the dollar under pressure. The trade war, it turns out, can explain both a rally and a decline in the value of the dollar when needed.

Another negative for the greenback that circulates in the media is Michael Cohen’s guilty plead in a New York court, which implicates the President in illegal payments during his presidential campaign.

The problem is that both Trump’s fresh tariff threats and Cohen’s guilty plead happened yesterday, while the EURUSD chart below was sent to our subscribers eight days ago, on August 15th.
EURUSD bullish Elliott Wave reversal forecast
Since nobody can predict news and events, most Elliott Wave analysts do not even try. We certainly don’t and the latest news was just as startling to us as it was to anybody else.

Recognizing a pattern on a chart, on the other hand, is possible and that is what Elliott Wave analysis is all about. The pattern in question was a contracting triangle correction in the position of wave 4, labeled a-b-c-d-e. According to the theory, triangles precede the last wave of the larger sequence. In EURUSD’s case, the last wave was wave 5, which we thought was almost over on August 15th, meaning a bullish reversal was just around the corner.
EURUSD updated Elliott wave chart
EURUSD fell to 1.1300, where the bulls decided they have suffered enough. A week later, they were back above 1.1600. This situation proves that traders do not have to be ahead of politics, in order to stay ahead of the markets. The latter is possible without the former. Especially in the totally unpredictable twists and turns of the Trump era, relying on the news to guide our trading decisions is a game we don’t want to play. The Elliott Wave principle is a far superior alternative.

What will EURUSD bring next week? That is the subject of discussion in our next premium analysis due out on Sunday!



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

NZDUSD Fibonacci Bounce Causes Optimism

At the start of December, 2018, NZDUSD almost reached 0.6970. A month later, the “flash crash” which brought chaos to many other Forex pairs, dragged the New Zealand dollar to 0.6586 on January 2nd, 2019. As of this writing, NZDUSD is hovering around 0.6760 and the bulls are probably wondering whether this is a chance…

Read More »

GBPNZD ‘s Elliott Wave Recovery Far from Over

A month ago we shared our view that despite being long-term bearish on GBPNZD, we thought it was time for a notable recovery. While the pair was hovering around 1.8400, the market was sending a message that a recovery to roughly 1.9000 was around the corner. As always, this message had nothing to do with…

Read More »

USDJPY Crashes After Textbook Elliott Wave Setup

It is not just stock market investors and oil bulls, who have been suffering lately. The holidays do not promise to be very happy for USDJPY bulls, as well. The pair fell to 110.81 on Thursday, revisiting levels last seen in early September. The Fed rate hike, the stock market crash and the tensions between…

Read More »

GBPAUD Recovery Interrupts Larger Downtrend

Life has been tough on GBPAUD bulls recently. The pair reached a two-year high of 1.8733 on October 11th, but failed to maintain the uptrend. On December 3rd, the Pound fell to 1.7210 against the Australian dollar – a crash of over 1500 pips in less than two months. As of this writing, the pair…

Read More »

GBPNZD: Support Ahead, Downtrend Still in Progress

On November 2nd, GBPNZD was trading above 1.9550. As of this writing, the pair is hovering slightly below 1.8400, meaning the British pound lost over 1150 pips against the New Zealand dollar in a single month. Fortunately, the Elliott Wave Principle put traders ahead of this sharp selloff. The chart below, published on November 5th,…

Read More »

EURNZD Bulls Look Better Going into December

Yesterday, we shared our view that despite being down by over 460 pips this month, a bullish reversal can be expected in EURAUD around 1.5500. Now, we are going to take a look at EURNZD, which lost even more in November. The pair plunged from 1.7359 to 1.6515 in the last thirty days, following a…

Read More »

EURAUD Bears Getting Tired. Bullish Reversal Ahead?

With only one day left, the Euro seems poised to end November in positive territory against the U.S. dollar, following a sharp decline in October. Unfortunately for the bulls, the European currency is still losing to some of its other rivals this month. EURAUD, for example, is down by over 460 pips since the start…

Read More »

More analyses