If my number are correct, the correct wave should be taking place. I have went long on this pair and AUD/USD (I will post AUD/USD another time). The image shows the speed this second speed level being tested. I believe point 5 is where it is is because it is also where wave C is- in the bigger wave before it. IT touches the channel line and retraces. If this wave were seen from a larger perspective, it can be seen as a rapid wave up, therefore; I added channels for those in red. During the next few weeks or so, if the EUR is still in a bearish mode, we can see it attempt to break the November fractal low. If it does, then market will definitely be bearish. But I have indications of it being more bullish then bearish within the 4hour, 8 hour and daily time frames. I am anticipating if price will test the second speed level with also coincidentally happens to be near the 61.8 percent fib level.
My prediction: From the head and shoulders review, since price had it’s complete order, it can retrace up to a certain fib levels and THEN continue the bearish move. I am in the trade for the correction wave anticipating only a couple hundred pips. IF the trade will go in my direction, I will pull 1/2 out at 100 pips flat and let the rest run with a trailing stop. Once it reaches the levels of retracement, expect another retracement down- as in, going short. This would be ideal to me because the EUR/USD pair would want to test the November low to actually define market flow. IT has broken the January’s low, so why not test the November low? (have in mind that there is also a early December low) I decided whether or not to to liquidate my position depending on how the market reacts the levels i indicated on the graph. What i find conflicting is that price has moved from lower lows to higher lows which what everyone should know as a bearish condition. I have not yet done my analysis for the hourly nor the 30min nor 15min. I dont know if i want to post them up yet.