FX.co ★ EUR/NZD - Elliott Wave Analysis for October 3 - 2012

Today's Support and Resistance Levels:

S1: 1.5621 R1: 1.5752

S2: 1.5577 R2: 1.5810

S3: 1.5507 R3: 1.5902

Technical Overview:

After a small setback to 1.5505 we saw a very powerful move above the base channel line at 1.5650, which is a clear indication of the correction from 1.5902 is over and wave iii is under way. The impulsive rally in wave iii will meet resistance at 1.5773, but we think that there is a very good chance that this rally can extend towards 1.5871. We should remember that if our scenario is correct we have entered wave 3 and corrections tend to be very small. This is the wave we will want to ride. This is the wave we call the wonder to behold.
Support is found in the 1.5621 - 1.5627 area, which will ideally protect the downside.
Looking at the larger picture we expect this wave 3 to keep moving higher towards strong resistance at 1.6969.

Trading Recommendation:

With the minor correction down to 1.5505 we could easily buy EUR at 1.5545 and will lift our stop to 1.5500. If you are not long EUR already you should buy a possible correction back towards 1.5627 with the same stop.