USDPLN Elliott Wave Forecast: Identifying Blue Box Area

In this blog, we take a look at Elliott Wave structure of USDPLN forex pair since 1/31/2019 low and our main goal is to identify the blue box area within the pull back and what we could expect to happen from the blue box area. In our previous article about USDPLN  we explained that pair is showing 5 swings up from 9/26/2018 low which makes it a bullish sequence against 1/31/2019 low and hence it should find buyers in the pull back after 3, 7 or 11 swings.

USDPLN 1 Hour Elliott Wave Analysis with Blue Box

Below is a 1 hour chart of USDPLN forex pair which shows the rally from 1/31/2019 (3.7063) low to be have unfolded as an Elliott Wave Impulse within which wave ((i)) completed at 3.7315, wave ((ii)) completed at 3.717, extended wave ((iii)) completed at 3.8392, wave ((iv)) completed at 3.8131 and wave ((v)) at 3.8594. We have labelled this as wave A and currently we are within wave B pull back to correct the 5 waves move up from 3.7063 low.

Wave B is proposed to be unfolding as a double three Elliott Wave Structure when wave ((w)) ended at 3.818, wave ((x)) ended at 3.8459, pair has already made a new low below wave ((w)) so there are enough number of swings in place to call wave ((y)) and B completed at 3.8071. However, pair failed to reach the blue box so far so while below the descending trend line, there is still scope for the pair to reach the blue box between 3.8047 – 3.7791 area to complete a double three Elliott wave structure down from 3.8594. As the right side is up and there is a bullish sequence, so we don’t like selling the pair and expect buyers to appear in the blue box. Pair could either resume the rally in wave C from the blue box or bounce in 3 waves at least to allow longs to eliminate risk on the trade.

If the bounce from blue box fails and pair drops to new lows again, then we should be doing larger 7 swings structure within wave B pull back and pair should still see buyers at the next blue box area. If pair breaks above the descending trend line (currently at 3.8357), that would suggest cycle from 3.8594 high ended already at 3.8071 which could be wave B or just the first leg of wave B pull back. In either case, 3.7063 low remains to be key for the bulls and as far as we stay above this level, we should see more upside in the pair.