FX.co ★ EUR/NZD - Elliott Wave Analysis for September 7, 2012

Today's Support and Resistance Levels:

S1: 1.5710 R1: 1.5778

S2: 1.5689 R2: 1.5814

S3: 1.5667 R3: 1.5874

Technical Overview:

We finally managed to see a decent correction after a series of sub normal corrections, but we know that is the normal outcome in an extended third wave. The ideal target for this correction is at 1.5667, from where we should see the next rally higher towards 1.6211 as the ideal target for this first wave in a new long-term uptrend. Below is a chart of EUR/NZD dated back from January 1992. The chart shows that a major flat correction has taken place over the last 20 years and the correction ended we the test of 1.4968 on August 2012. That means that a new long term uptrend has begun. The final decline from 1.9570 has taken the shape of and ending diagonal and the first target we are looking for is the ending diagonal resistance line near 1.6210, however, in long-term we should see much higher levels in this cross.

Trading Recommendation:

Buy EUR against NZD at 1.5675 with a 1.5580 stop and take profit at 1.6185.