EURUSD: 04/18/2017

EURUSD - Primary Analysis - Apr-18 1020 AM (1 week)

The chart above presents my Elliott wave interpretation on the EURUSD currency pair. I see a complete ABC decline from the all time high of 1.6. This tells us that the upcoming advance is likely to completely retrace the decline since the decline is corrective in nature. Such structures are usually fully retraced due to the continuation of the longer term trend which in this case is to the upside. Confirmation that such a pattern is complete would be a break of the wave 4 high which currently rests at 1.13. Once this level is taken out then the entire corrective pattern will prove to be complete which should ideally be followed by a swift impulsive advance that is likely to rise in a similar manner as the decline of 2014 going into the March low in 2015.

EURUSD Phasing

The chart above presents my phasing on the weekly chart of the EURUSD. It seems evident that we are looking for an 18 year cycle trough at the time of writing. J.M. Hurst warned that the transaction risk is magnified when looking at troughs of larger cycles since there exists the possibility of more work to be done prior to putting in such a trough. It is important to note that we have the initial signals of an 18 year cycle trough based on the projection of the similar cyclical circumstance and the breach of the 40 week FLD. The breach of the 40 week FLD is enough confirmation to indicate a trough of the 18 year wave since we were in the final 40 week cycle of the current, or I should say previous, 18 year wave. Additional evidence of an 18 year cycle trough comes from the phasing of commodities which are all putting in their respective 18 year cycle troughs at the time of writing. It is important to note that we are on the verge of a trend cycle higher of the current Kondratieff wave since the trough of the long wave was in 2001 suggesting that the upcoming advance is likely to dwarf thee previous advance seen in the early 2000s. It is evident that the previous 18 year cycle was not a trend cycle considering that we peaked in the first 9 year wave rather than the second which is indicative of either a base cycle or a terminal cycle. The upcoming trend cycle should realize its peak in the second 9 year wave hence we can expect a long lasting shift in the tide of the EURUSD.

EURUSDprojection

The chart above presents my projection on the EURUSD based on the 18 year cycle position. The correlation of this projection line is over 90% suggesting that it is most likely the true SCC. The projection suggests that we are on the verge of a significant volatile advance going forward. We have reason to believe that it is likely to be even more volatile considering that we are in the initial stages of a trend 18 year cycle in the EURUSD currency pair that should ideally dwarf the preceding 18 year cycle.

18 month FLD

The chart above presents the 18 month FLD. Considering that we are in the final 18 month wave of the current, or I should say previous, 18 year cycle, a breach of the 18 month FLD would be indicative enough of a trough of the 18 year wave. This is why I am watching this FLD very closely and would continue to add to my positions in the EURUSD as this FLD is taken out to the upside.

EURUSD daily phasing

The chart above presents my phasing analysis on the daily chart. I have to say, that this daily phasing is not ideal since the SCC suggests a swift and abrupt advance as soon as the 18 year cycle trough is realized which did not seem to occur on the EURUSD recently. It is important to note however that the structure seems to be complete and a continued advance is likely. From a traditional technical perspective we seem to have formed a higher low and a higher high which is the classic definition of an uptrend. Following the saying ” Never buck a trend” will certainly prove to be a wise choice in the EURUSD currency pair.

40 errk FLD As a final note I would like to mention that the 40 week FLD was taken out to the upside suggesting that the 40 week cycle has turned. Considering that we are in the final 40 week cycle of the 18 year wave this could be the initial indication of a trough of the 18 year wave although I would much rather prefer the 18 month FLD and the 40 week VTL presented in the previous picture to be taken out in order to confirm that such a trough is in place.

In conclusion I would like to state that all of the evidence suggests the the EURUSD currency pair is bullish for many years to come. As mentioned earlier, we are on the verge of a trend cycle that is likely to dwarf the advance that occurred since the onset of the EUR, this is certainly a time to be accumulating positions in the EURUSD to hold for the long term.

Kind Regards,

Ahmed Farghaly

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