Written by www.ew-forecast.com |
USDCAD slowed down over the past few sessions in 1.0270-1.0310 range which has been expected after an impulsive sharp rally from 1.0181 labelled as wave a). We know that after every impulse correction follows which typically means a slow and choppy waves in tight ranges. And that is exactly what we see on USDCAD right now, so we suspect that pull-back from 1.0310 represents wave b) as a part of incomplete recovery from 1.0181. With that in mind, short-term traders could be interested in longs from around 1.0230-1.0260 region to catch wave c) up. Any stops in such case should be placed beneath 1.0181 invalidation level.
A zig-zag is a 3-wave structure labeled A-B-C, generally moving counter to the larger trend. It is one of the most common corrective Elliott patterns. From a trading perspective wave C represents a trading opportunity from end point of wave B, as long as wave B stays above the start point of wave A.
- Structure is 5-3-5
- wave A must be a motive wave
- wave B can only be a corrective pattern
- wave B must be shorter than wave A by price distance
- wave C must be a motive wave.
- appears in wave two or four in an impulse, wave B in an A-B-C, wave X in a double or triple zig-zag, or wave Y in a triple threes