As you all may know from previous posts about how I analyze and use harmonic patterns, I often look for patterns in the larger context of the overall trend. And further, when they appear in clear Ellott Wave fractals, I place a higher percentage on the possibility of a reversal.The Forex Chart Spotlight today is the EURAUD.
As I was monitoring the EURAUD daily time frame, I also noticed that there is a great supporting case for a possible rally in its weekly pattern.
If you all are not familiar with the Ian Copsey “modified” Elliott wave I highly recommend picking up his very interesting book on the subject: “Harmonic Elliott Wave: The Case for Modification of R. N. Elliotts Impulsive Wave Structure”. I have attached his basic revision of the impulse elliott wave to the chart below. In short he purposes to adjust the 5 wave impulse rule to a 3 wave impluse rule & in some respects simplifying the overall approach to wave analysis. As you see in the chart below I have idendifed this possible structure in the Weekly scale EURAUD. Current price also is sitting right in the wave 4 possible reversal zone (between 38.2 and 61.8 of the measured length 2 to 3).
EURAUD Weekly Chart
On the Daily scale a very clear bullish bat formation has occured and successfully bounced off the PRZ (Potential Reversal Zone). I have drawn the possible Measured move of this pattern.
EURAUD Daily Chart
For a full length reverence study guide of these harmonics feel free to visit this user guide I made for the newsletter.
Update for all my followers: As you know I have been publishing a free Harmonic Pattern Trading Newsletter for a few months now. With the success its seen in terms of performance and interest in the trading model. I will be slowing phasing it into a paid research product through Marketfy.com. For now I will still post the some forex charts exclusively at seeitmarket and I will keep posting the entire chart stream on my twitter and stocktwits: @interestratearb.
Thanks for reading.
No position in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.