FX.co ★ EUR/AUD Analysis for February 15, 2013

EUR/AUD Elliott Wave
Since our last analyses the EUR/AUD pair was trading downwards like we expected, corrective C wave (coloured blue) of the bigger wave (4) (coloured green) was developing. During the Asian and the European sessions, we could observe a strong descending movement from 1.2990 towards 1.2855 level and we can consider this movement as the end of the 3 sub-wave of the C correction (coloured blue). Therefore, during the New York session, when developing of the sub-wave 4 begun, this currency did not manage to hold this level and the price started pushing higher, reaching a new sessions high at 1.2914 level. Today the EUR/AUD pair is trading around 1.2870 level and we are expecting to see the price higher when developing of the final (5) wave (coloured green) starts. In accordance with our wave rules and taking into account that the wave 5 should retrace 161.8% of the wave 1, we can define the potential targets with measuring wave 1 with take profit at 1.3431 (161.8% of wave 1). To reduce the risk, we can use invalidation at 1.2737 level as stop loss.

Support and Resistance
(S3) 1.2770 (S2) 1.2826 (S1) 1.2861 (PP) 1.2917 (R1) 1.2973 (R2) 1.3008 (R3) 1.3064

Trading Forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upward movement. That is why long positions at level 1.2800 with stop loss 1.2737 and take profit at 1.2800 are recommended.