FX.co ★ Elliott wave analysis of EUR/NZD for September 12, 2018

The 1.7820 targets have now been tested. The question is whether this was the top of red wave iii and a correction in red wave iv is needed now? We have seen a quite massive negative divergence being build in the run higher to 1.7820, so it should come as no surprise if a minor correction in red wave iv is about to begin. A break below 1.7738 will indicate this is the case.

That said, the rally to 1.7820 only represents the minimum extension target of red wave i. Therefore, we have to be equally ready for this extension to continue towards the next extension targets at 1.7954 (the 200% extension of red wave i) or even higher to the 261.8% extension target of red wave i at 1.8184.

R3: 1.7954

R2: 1.7900

R1: 1.7825

Pivot: 1.7738

S1: 1.7678

S2: 1.7629

S3: 1.7590

Trading recommendation:

We are long EUR from 1.7330 and we will move our stop higher to 1.7730.