The correction turned out much smaller thane expected and was likely only a red sub-wave iv correction and not the start of the correction in black wave ii/ as we where looking for. This means the rally of red wave iv is red wave v and the ideal target for this wave is seen at 130.38, where the red wave v will be equal in length to the red wave i. Once the impulsive rally from 124.89 finds its peak, a correction to at least 127.64 should be expected.

In the short-term, a break below minor support at 129.58 will indicate that the black wave i/ has completed and the black wave ii/ is developing.

R3: 130.60

R2: 130.38

R1: 129.95

Pivot: 129.58

S1: 129.21

S2: 128.78

S3: 128.42

Trading recommendation:

Our stop at 129.80 was hit for a 50 pips loss. We will resell EUR at 130.35 or upon a break below 129.58 with a stop placed at 131.35.