07.06.201310:30 Forex Analysis & Reviews: Elliott Wave analysis of EUR/NZD for June 7, 2013

Today's Support and Resistance levels:

R3: 1.6780

R2: 1.6739

R1: 1.6663

Current spot: 1.6642

S1: 1.6591

S2: 1.6539

S1: 1.6472

Technical overview:

As it is typical for a wave three, it just keeps moving higher and higher leaving everybody looking for a correction with a loss. Even though this market seems overbought we should expect even more from it. As we expected green wave v is extending and we should look for a continuation higher towards 1.6739 as the top of green wave v and blue wave iii, but after only a shallow correction the next move higher will take place. It might be tempting to try to sell near 1.6739, but we do not recommend it, as we should not expect much of the next correction and, therefore, the risk of taking a loss is high and worse the risk of seeing the train without you on board is equally high. In the short term we are looking for support at 1.6591 to protect the downside for the next swing higher towards 1.6739. Only a break below 1.6539 will indicate that we have seen the top of blue wave iii and blue wave iv is developing.

Trading recommendation:

We are long EUR from 1.5790 and will move our stop higher to 1.6385. If you are not long EUR already then wait for the possibility to buy EUR near 1.6500 as blue wave iv develops.