Bottome line: stocks were repelled at a prior swing high as well as 50% fibonacci retracement right now. I believe this is only a temporary barrier, with the current decline possibly being the start of Minor wave B. Once Minor B is over, Minor C higher will be in full force, a strong 3rd wave surge into my reversal zone labeled above. Once Minor wave C is complete, Intermediate wave (2) might be complete, and then disaster should strike for stocks with a large and very destructive Intermediate wave (3).
Learn to apply Fibonacci ratios to calculate price targets in stocks
- Elliott Wave International
I'm uncertain of the wave count in the euro since it started so choppy and with a lot of 3 wave moves around the high. So I'm using basic technical analysis, and monitoring stocks in correlation to the euro since they tend to move parallel more or less. You'll notice here that the euro is also trading at, and having trouble at, the 50% fibonacci retracement level. Although, keep in mind I'm not using my fibonacci measurement equal to stocks since the euro's fibonacci does not start at the high on the chart. The reason I'm not starting it at the high in the euro is because it doesn't look like a full 5 waves down from the high, so the next best thing is to measure the length of the sharp decline itself and count the retracement from that only. Needless to say, the euro is not painting a clear picture here so I don't want to trade it. But when stocks top in Intermediate wave (2) I will be looking to short the euro along with stocks despite the euro's lack of clarity.
Learn Elliott Wave Principle
PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.