European stocks were down for around 4% earlier today in growing risk regarding the “Grexit†after a serious escalation in the Greek crisis. The euro was down across the board when markets opened, but the currency is recovering now against the dollar and trying to fill the open gap around 1.1160.
On the updated chart of EURUSD we see a completed wave D) at the latest low, so the current rally can be wave E) which has two resistance levels. The first one is at 1.2220, while the second one comes in near 1.1400. We expect to see a turn down from one of the highlighted regions, but will pay close attention to the first one as sometimes E)-waves can be small and not so deep.
Elliott Wave Analysis – EURUSD 1h
The reason for the bearish view on EURUSD after the pullback is done, is the USD Index, where we see a clear impulsive trend to the upside. We are observing two wave counts, but both suggest more gains ahead after a three wave set-back to around the 95.30 zone where support can be found.
Elliott Wave Analysis – USD Index #1
Elliott Wave Analysis – USD Index #2
