EURUSD Could Bounce Back to 1.3220-1.3250 Before Downtrend Resumes

eurusd-aug-04-2013-4h

EURUSD 4h Elliott Wave Analysis
EURUSD is trading nicely lower for the last two weeks, which could be start of a new larger impulsive bearish trend. Notice that decline from 1.3400 is much larger compared to first leg down from 1.3450. Well, as we know third waves in the middle of a five wave decline are typical the longest, so we suspect that market is forming an impulsive decline, now with back wave 3 in progress that can extend even down to 1.3020 level while market trades beneath the upper trend line of a base channel. However, corrections and pull-backs will always occur, so don’t be surprised by a retracement back to 1.3220-1.3250.

Gregor Horvat, based in Slovenia, has been in the forex markets since 2003. He is a technical analyst and individual trader who has worked for Capital Forex Group and TheLFB.com. He also is founder of forex services on www.ew-forecast.com. EW-Forecast.com provides technical analysis of the financial markets, highlighting behavioral patterns based on the Elliott Wave Principle (EWP). Website: http://www.ew-forecast.com