EUR/USD Possibilities

Here are several EUR/USD 4 hour charts showing the possible future movements of the pair. I have listed them in order of most favoured to least favoured. This first one is my current primary count because the move off recent from the low at 1.2153 looks very much like a leading diagonal to me. Also I am bullish on equities in the very short term but bearish in the medium term, which fits well with this count. As you can see it looks to me as if the pair has almost completed a wave ii down and is about to head higher in a wave iii. If this could is correct it is likely that price will turn soon and will test 1.245 on Monday or Tuesday. A break beneath 1.2150 will invalidate. Based on this chart I am going to take a long position at 1.2240 which is the near both the 76.4% Fibonacci level and extension where wave a of ii equals wave c of ii.

Here is a more bullish count for the pair, showing a truncated wave 5 which will be a medium term bottom. If this count is correct we will likely see a sharp surge upwards during Mondays session. I do not favour this count due to my bias towards increasing risk aversion over the coming months. If however this count is correct expect price to test 1.30 at a minimum, but more likely higher. The 38.2% Fibonacci of the entire move down from the top lies at 1.33.

Finally here is my bearish EUR/USD count. I am highly doubtful that this scenario will unravel however it is always important to be aware of both bullish and bearish possibilities. Here wave 5 has begun, and looks like it is going to extend downward. The reason I am dubious of this move is that the fall from the 1.2454 high does not look impulsive at all. However it is possible that is is a choppy leading diagonal and price is going to drop hard through 1.2150 early in the week.