Hi Traders,

our weekly Elliott Wave analysis reviews the EUR/USD, the Bitcoin crypto currency, and the DAX 30 stock market chart.

EUR/USD Bullish Reversal Candlesticks on Weekly?

The EUR/USD showed a bullish weekly candle last week. What does it mean for the long-term picture? Let’s review:

1. The EUR/USD was unable to break below the previous low and bottom. The bullish bounce created a bullish candlestick pattern on the weekly chart.
2. The bullish reaction could indicate a first signal that a wave D (pink) of a larger ABCDE triangle pattern (pink) is taking place. 
3. A bullish ABC (green) pattern in wave E (pink) would confirm it.
4. The wave A (green) will probably reach the 38.2% or 50% Fibonacci level before making a wave B (green) down.
5. The wave E (pink) can bounce (red arrows) at any Fibonacci level of the wave C-D price swing.
6. An immediate break below the bottom invalidates the bullish correction. Whereas a break above the top invalidates the bearish triangle pattern.

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BTC/USD Bullish Triangle Chart Pattern

Bitcoin is building a triangle chart pattern at the moment, which is indicating a lengthy period of consolidation and uncertainty:

1. BTC/USD is making lower highs and higher lows. This triangle pattern occurs after a strong bearish price swing (wave A gray). The triangle pattern, however, seems to favor a bullish retracement within wave B (gray).
2. This bullish outlook remains valid as long as price action remains above the support trend lines (green).
3. A break above the resistance (orange lines) could indicate a push up towards the Fibonacci resistance retracement levels and previous top.
4. Those Fib levels and top are expected to be resistance and stop price from rising further.
5. A deep price swing towards the Fibonacci levels could be an ABC flat whereas a shallow move up is an ABC zigzag.
6. An immediate push below the support indicates a downtrend and not a bullish retracement.

DAX 30 Bounce Could Test Previous Top

The DAX 30 chart made a strong decline but also a strong bounce after reaching the 12,500 support zone:

1. The DAX 30 is probably making a wave B (pink) upwards.
2. The resistance zone and previous top could therefore cap the move up.
3. A bearish bounce at the resistance would confirm this wave analysis.
4. A move down towards the 23.6% would then be expected.
5. The next major support and decision zone is the 23.6% Fibonacci level.
6. A break below the 23.6% Fib could indicate a deep wave C (pink). 
7. A bullish bounce could indicate a shallow ABC and more uptrend.

Good trading,
Chris Svorcik