The price action appears to be falling under a massive 1-5 impulse wave pattern, as postulated by the Elliott Wave Theory. Recently, the downtrend completed the second impulse leg (2-3), which clears the way for a minor bullish pullback.
It is likely to take the form of an ABC correction, representing the second retracement leg (3-4); that is, if the price action manages to penetrate above the upper limit of the descending channel.
Bears could take advantage of this by trading on the expectations for the formation of another impulse leg (4-5). The correction is likely to be terminated around the previous swing low at 1.26500 before such a reversal could occur.
It is likely to take the form of an ABC correction, representing the second retracement leg (3-4); that is, if the price action manages to penetrate above the upper limit of the descending channel.
Bears could take advantage of this by trading on the expectations for the formation of another impulse leg (4-5). The correction is likely to be terminated around the previous swing low at 1.26500 before such a reversal could occur.
