The wave counting on the 4-hour chart for the Euro/Dollar instrument remains rather ambiguous, since at the moment two corrective trend sections have already been built and, most likely, the construction of the third downward trend has begun. If this assumption is correct, then the decline in quotes will continue with targets located near the 15th and 16th figures. At this time, the construction of the supposed wave a and, possibly, wave b is presumably completed. Thus, the decline in quotes may continue right from the current values. The internal wave pattern of the supposed wave a looks very ambiguous, however, let me remind you that the internal structures of corrective waves can be very, very complex. Although now just waves of structure a -b - c look quite real and true. Thus, it is quite possible to count on a new decrease in quotes.
The news background for the Euro/Dollar instrument remained extremely weak on Tuesday. To date, there have been only a few entries in the news calendar that could catch the attention of the markets. Just a few hours ago, Christine Lagarde spoke at the Brussels Economic Forum, and twenty minutes later the indicator of consumer confidence in the United States came out. It is extremely difficult for the markets to expect positive information and "hawkish" statements from Christine Lagarde. This is evidenced by her latest statements, in which the President of the ECB has repeatedly hinted at the weakness of the European economy and its unwillingness to complete support programs. Thus, it is likely that Lagarde adhered to this rhetoric today. Therefore, even before the speech began, it was clear that there would be no support for the euro currency.
The indicator of consumer confidence in the US, on the contrary, turned out to be quite strong, which gave the US currency additional strength. The indicator rose from 120 points to 127.3 points, which also provided a little support to the dollar. Thus, there were few events today, they were not the most important, nevertheless, they caused an increase in demand for the US currency. And the growth of the dollar fully corresponds to the current wave counting, so, so far everything is going according to plan. However, the most important and interesting events of the week are just ahead. Let me remind you that on Wednesday and Friday, the US will release reports on the state of the labor market (ADP and Nonfarm Payrolls), and the European Union on inflation on Wednesday. I believe that the data on the labor market will be able to greatly influence the current wave picture. Obviously, we need strong data from the US so that the demand for the US currency remains high. In the case of European inflation, on the contrary, weak data is needed, or, in other words, the growth of the consumer price index the stronger, the better.
Based on the analysis, I still expect a new decline in the instrument quotes within the expected wave c. The supposed wave b may have completed its construction. Thus, I recommend selling the euro with targets located near the calculated levels of 1.1836 and 1.1704, which equates to 76.4% and 100.0% Fibonacci for each MACD signal "down".
The wave counting of the new upward trend section is not entirely unambiguous, however, at this time, it is presumably completed and has assumed a three-wave form. Thus, now I am waiting for the construction of three downward waves, the first wave may already be completed, and the second is in the process of completion or is also already completed.
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