EUR/USD - Scope for sell-off to 1.1846 - Commerzbank

Karen Jones, Analyst at Commerzbank, sees scope for a drop to  1.1846, courtesy of a more bearish looking intraday wave count.

Key quotes

EUR/USD has reversed ahead of the 1.2092 September high, and now eroded support offered by the 1.1961 November high. The intraday Elliott wave counts have turned a lot more negative and are currently implying scope for a sell off to the 2 month uptrend at 1.1846. Rallies are indicated to terminate circa 1.1980.

 It will remain overall bid above the 1.1846 short term uptrend and this guards the 1.1717/12 November and December lows. The 1.1712 mid November low guards the 1.1553 7th November low.

Where are we wrong? A rise above 1.2092 will target the 1.2168 50% retracement of the move down from the 2015 high and then the 1.2414 200 month ma.

Short Term Trend (1-3 weeks): Positive target 1.2087/92.

Long term trend (1-3 months): Neutral to positive. It is possible that the move to 1.1553 was the end of an a-b-c correction lower. This would mean that the longer term risk is still on the topside.