FX.co ★ Elliott Wave Analysis of EUR/NZD for September 9, 2013

Today's Support and Resistance levels:

R3: 1.6744

R2: 1.6626

R1: 1.6551

Current Spot: 1.6484

S1: 1.6408

S2: 1.6325

S3: 1.6225

Technical summary:

The price continues to plunge lower and we are getting awful close to the start of wave i, which comes in at 1.6325. If my preferred count (see the chart above) is the correct count, a break below 1.6325 can not be allowed. Therefore, we need to see some impulsive price-action higher soon. The first positive sign will be a break above 1.6551, but we need a break above 1.6626 and even more importantly a break above 1.6809 to confirm, that wave ii is in place and confirm that wave iii is developing for a rally back towards 1.7274 and higher, at least, to 177.80. However, if we break below 1.6325 the above count can not be correct and we will need to consider an alternate count (see the chart below). This count tells us, that we currently are in the c-wave of an expanded flat correction and the c-leg of this expanded flat correction will likely continue lower towards 1.6117, where this X-wave will correct 50% of the rally from 1.5080 and wave c of the expanded flat correction will be 1.382 time wave a.

Trading recommendation:

Stay long in EUR or buy after a break above 1.6625 with a stop at 1.6320.