Wave analysis

We assume, and the market has …

Possibility of the achievement purposes which are in area 1.6800 - 1.7000 - 1.7200, to presidential election in the USA while it is removed on time. The condition of the USA financial system and amplifying difficulties in Eurozone economy, introduce the corrective amendments. More in detail, about possible terms of specified purposes achievement, it will be possible to speak after current correction. In this connection it would be desirable to look once again at chart EUR_USD with monthly time frame since in our opinion exists two variants of the Euro further development situation. Objectivity for the sake of, it is necessary to tell that the third variant … has appeared also, but about it to speak while early. As we already marked in the beginning of the August, the first what face, analyzing chart  EUR_USD with monthly time frame, it is shortage of the historical data. Therefore it is necessary to guess only: the maximum of 1995 is top W (1), or W (3)? And the minimum of 2000 is W (2) or W (4)? The same problem concerns also other currency pairs …           

Nevertheless, we can ascertain absolutely definitely correction АВС between max. 1995y. and min. 2000, with ideal equality of waves A and C.Than we abstract from what wave we observe since 2000: W (3) or W (5), also we will consider only its internal structure. Apparently on fig. 1 while three waves 1-2-3, or perhaps A-B-C, presumably, are generated. Each of them has difficult enough internal wave structure. Nevertheless, the wave 1 which have begun from a bottom of 2000, has given the size 2.618 - 3.000 dimensions of Fibonachchi, to a maximum in December, 2004 and has designated a prospective wave of 1 ascending trend. After the correction which have terminated in 2005 (century 2), has followed new growth of an euro current rate therefore the wave 3 is generated. Its dimension corresponds 0.764 from length of a wave 1. At the moment we observe the beginning of correction and presumably correctional wave 4 formation After its end it will be logical to expect new easing of dollar in a wave mode 5. About its target levels to speak while early since now they are looked through in a range from 1,6800 to 1.7000 and even 1,9000. Present correction while is only in an initial phase, the near purposes lie on marks 1.4355 and 1.3840. After formation correctional A, it will be possible to try predict time extent of this wave 5.              

Since after an exit from correction АВС 1995 - 2000, at formation of an ascending trend, it is possible to speak only about 5 wave structure - there is one more variant of development of a situation. Considering depth of world financial crisis, to bring down the prices for power resources (including and at the expense of dollar strengthening), unsteadiness of all geopolitical design - it is possible to assume attempts that the five-wave structure in W (3) or W (5), is already generated (fig. 2) . In that case, the correction purposes all assumed W (3) or W (5), can be: 1,4200 - 23.6 %; 1,3050 - 38.2 %; and 1,2130 - 50.0 %. After their working off, pair EUR_USD can pass in a lateral trend. But to build the forecast in this direction while early. From on what mark, from the levels resulted in both variants, correction will end, it will be possible to assume the further development of a long-term situation on EUR_USD. On the week chart, all the same has worked the factor break Andrews's Pitchfork average line and working off to 5.236 dimensions of Fibonachchi from maximum W1. But developing correction allows to ascertain that the variant of the purposes achievement 1.70 - 71 - 72 to presidential election in the USA, almost is for certain cancelled. An internal wave marking of a prospective wave 3 (or) while it is kept. Attention it is transferable on working off correctional levels.   Day chart. As we wrote earlier, break the price level 1.5280, will mean cancellation of a transient correction variant and accordingly fast achievement of marks lying in a range from 1,6800 till 1.70 - 71 - 72. The crisis phenomena in a world financial system have introduced the corrective amendments … While pair EUR_USD is in a descending trend, possibly forming a wave A in correctional АВС. In turn, the internal structure A consists of 5 waves. As we see in drawing, visually it looks not absolutely ended, - despite that dimension 1.618 on Fibo in this connection we can assume is fulfilled that else we will see it near the correctional levels resulted in drawing (1.4355; 1.3838).