USDCHF Could Test 1.0000 By The End Of 2013 - Elliott Wave Forecast

USDCHF: Sharp reversal in 2011 from 0.7000 area is impulsive leg, and we know that impulses show direction of a current trend. As such, we think that pair is now bullish for minimum three wave rise; A)-B)-C). In the last few months we have seen a slow and choppy price action in 0.8900-1.0000 range which now seems to be a contracting triangle placed in wave B). We can already count five waves within this pattern so traders must be aware for a push higher into wave C) later this year.

USDCHF Weekly Elliott Wave Analysis

On Daily Chart contracting triangle is now in final stages. We are tracking a wave E that may be looking for a support around 0.9050-0.9200 zone. An impulsive bullish reversal in price back to 0.9700 will put USD in bullish mode against Swiss franc for a push above parity.

USDCHF Daily Elliott Wave Anaysis

 What is Triangle Elliott Wave Pattern?

A Triangle is a common 5 wave pattern which is labeled A-B-C-D-E.  Triangle moves counter-trend. It is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide 3-3-3-3-3.

Contracting Traingle:

• •        Structure is 3-3-3-3-3
• •        Each subwave of a triangle is usually a zig-zag
• •        Wave E must end in the price territory of wave A
• •        One subwave of a triangle usually has a much more complex structure than others subwaves
• •        Aappears in wave four in an impulse, wave B in an A-B-C, wave X or wave Y in a double threes, wave X or wave Z in a triple threes

Written by www.ew-forecast.com