Forex Trading Library

USDCHF Ending Diagonal Opens Fresh Lows!

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Chart of USDCHF

We talked about the USDCHF pair more than a month ago as it continues to build a triple Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ zigzag pattern.

The final actionary leg Ⓩ is likely to end in the form of a standard intermediate zigzag (A)-(B)-(C). The impulse wave (A) and correction (B) have ended. Wave (C), similar to the ending diagonal 1-2-3-4-5, is under development.

Four parts have been completed inside wave (C). So in the near future, we can expect the development of corrective wave 5 at approximately 0.850. At that level, intermediate waves (A) and (C) will be equal.

Chart of USDCHF

Let’s consider an alternative scenario in which the intermediate correction (B) is still being formed. It can take the form of a double zigzag W-X-Y.

Perhaps a minor actionary wave W is built in the form of a triple zigzag, and a bearish intervening wave X can also be completed

Thus, if the market moves within this scenario, then we will observe the development of the final actionary wave Y. Its end is expected near 0.949. At the specified level, correction (B) will be at 50% along the Fibonacci lines of (A).


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