Let's continue to analyze the situation in the currency market using the Elliott theory. Judging by the pattern, the formation of a downward impulse has recently begun. Given the fact that important news will be published today, the currency pair may noticeably fall.
EUR/USD H4 timeframe:
The analysis of the EUR/USD situation indicates that a large and long-term downward trend is being built on the market, which has not yet been fully completed. This trend is a bearish impulse [C], which is included in the last part of a long corrective wave 4.
The impulse [C] includes five sub-waves: (1)-(2)-(3)-(4)-(5). Of these five sub-waves, only the fifth wave remains to be done, which contains sub-waves of a smaller wave level: 1-2-3-4-5.
Since the development of correctional wave 4, which has taken the form of a simple zigzag [A]-[B]-[C], has recently been completed, it can be concluded that the decline in wave 5 has already begun. Inside this wave, [1] and [2] can be seen.
Today, the decline continued in impulse [3], which is still forming. Due to the fact that this wave is usually the strongest and fastest part of any impulse, a good decline can be expected today. And given that data on the number of initial applications for unemployment benefits will be published soon, the downward movement can be really rapid.
Trading recommendations:
The completion of wave [3] can be expected around the level of 1.1440. In this case, it is possible to open short positions today from the current level with the target of 1.1440.
