Report
Eric Morera

EURUSD : Identifying and Trading the Elliott Wave Zig Zag Pattern

EURUSD : Identifying and Trading the Elliott Wave Zig Zag Pattern

EURUSD Technical Analysis 

EURUSD : An Elliott Wave Zig-Zag pattern is a 3 wave (A,B,C) pattern consisting of a 5-3-5 wave structure. 5 waves for the wave A, followed by 3 waves for wave B and finally another 5 waves for wave C to complete the Zig Zag pattern. The Zig Zag pattern is a counter trend pattern and goes against the main trend so trading this pattern a trader should always use tight stops. Traders also need to watch price action for confirmation if the pattern will ultimately form.

EURUSD 1 Hour Weekend Chart 12.7.2019 : Start of the trading week of December 8 – 13/2019 we advised our clients that a Zig Zag pattern has formed and that the pair would push higher. We advised that the wave (b) 3 wave pullback has terminated and to watch for the next rally higher. EWF clients were clear that the trade to the upside was the choice to take. Only a move lower below the invalidation level would cancel the upside move.

Before

 

EURUSD 1 Hour Chart 12.14.2019 : Using other strategies/techniques as trading filters allows a trader to enter the market with confidence. Trading filters are rules/signals that need to be met before entering the trade. The chart below shows how a trader could have entered the BUY trade waiting on price action confirmation. Filters consisting of bullish divergence, a higher high/higher low sequence (HH/HL), support/resistance zones and an Elliott Wave Zig Zag pattern is what I used to catch the breakout trade higher which eventually hit the 1:3 RR and completed the 5-3-5 pattern.

After

Of course, like any strategy/technique, there will be times when the strategy/technique fails so proper money/risk management should always be used on every trade.  Hope you enjoyed this article and follow me on Twitter for updates and questions> @AidanFX  or chat me on Skype > EWF Aidan Chan

*** Always use proper risk/money management according to your account size ***

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Elliott Forecast

Elliottwave-Forecast.com (by EME PROCESSING AND CONSULTING LLC) was founded in 2005 by Eric Morera. Since inception our company has provided tailored Financial Market Services to thousands of clients. ElliottWave-Forecast has built a reputation on accurate technical analysis and a winning attitude. By successfully incorporating the Elliott Wave Theory with Market Correlation, Cycles, Proprietary Pivot System, we provide precise forecasts with up-to-date analysis for 52 instruments including FX majors, Gold, Silver, Copper, Oil, TNX and major Equity Indices. Our clients also have immediate access to our proprietary Actionable Trade Setups, Market Overview, 1 Hour, 4 Hour, Daily & Weekly Wave Counts. Weekend Webinar, Live Screen Sharing Sessions, Daily Technical Videos, Educational Resources, and 24 Hour chat room where they are provided live updates and given answers to their questions. 

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Eric Morera

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