EURUSD is approaching 1.30, but is this a reason for optimism? Traders are probably eager to know that.
The EUR USD rate managed to recover from the lows of 1.2858 and went close to 1.30 by the end of last week. However, it looks like this rise is only a temporary correction. Corrections are movements against the larger trend. Once they are completed, the larger trend resumes. In this case the larger trend is down.
Usually, corrective price action is contained between two parallel lines. You can see this characteristic here as well. In terms of the Elliott Wave Principle, corrections consist of three waves. EUR USD rate gives a good example of this feature on its 30-minute chart. As visible, the three waves here are labeled w-x-y. If this is the correct count, we should expect another decline from EUR USD, which could lead the exchange rate below the previous bottom. 1.2800 looks highly probable from now on.
