We have been tracking a potential ending diagonal pattern in EURUSD that suggests a retest of 1.17. This Elliott Wave pattern is running out of real estate to the downside to still remain valid. Therefore, if it is going to remain valid, prices will need to rally soon.
As it stands, the labels I'm following currently place us in wave (b) of ((v)) in the ending diagonal. That means we would need a (c) leg higher to finish it off (see "Final Leg of Diagonal Pattern" below for the higher time frame view.
A sustained break below 1.11 means we will need to elevate the alternate counts suggesting other patterns. There are times when the top 2 or 3 wave counts line up in the same direction...especially going into a news event. We have several important news events coming up in the next week like FOMC or the Brexit vote. However, today is not one of those days where the top wave counts are lining up.
Therefore, we'll need to be patient and wait for levels to break. 1.11 to the downside could be interesting for shorts. A move above the red trend line gets me interested to the long side.
2 tools we can watch for near term clues on price: 1. Live trader positioning - currently this is printing -1.12 as 53% of traders are short. Use this tool in a contrarian fashion
2. Grid Sight Indicator - This tool can help you see shifting momentum on an intraday level (down to a 1 minute chart). Watch this on 'm3' or 'm5' setting for clues about those shift. It is important to wait until AFTER the news to use this tool...don't use it as the news is being released.