Brazil – Wave 5 ended in FEB. We are now in the third leg, wave Y, which is a 3 wave decline marked as A-B-C and wave B mostly completed at the upper Bollinger band in a small 5 wave advance [wave c of B], so wave C down can go to 56000-55800 if C=A
Wave 4 up in the dollar is still not complete. This especially as the Euro bullish sentiment reached a multi year record of nearly 93%. This reading needs to cool off more and the dollar should at least move up in wave c of 4 before we see the decline resume. 95.225 was the recent low and till it holds this is the view.
The Euro This morning on the hourly chart shows a clear 5 wave decline in wave A, and a bounce back which is mostly B. 38.2% at 1.138 or 61.8% at 1.14 may be achieved in wave B after which wave C can drop to 1.125 or as far as 1.11. The 5 wave decline should mean that the 5 wave rise from the April low is complete and being corrected. The first pull back in a larger up trend.
Adam Smith Associates offers trade & commodity finance related services & solutions to its domestic and international clients. Views expressed in this article are purely of the author – Mr Rohit Srivastava – a leading technical analyst. Visit www.adamsmith.tv for services offered by Adam Smith Associates Pvt Ltd