FCPO. HIGHER TO COMPLETE WAVE 3 CYCLEPrice reached 2.618 fibonacci relationship compare to wave 1.
Evaluation based on market structure, we see an extension wave 5 within wave (3) rally.
If wave (3) has ended at fibonacci 2.618 area, we expect to see a 3 wave decline for wave (4) correction.
Elliott Wave Theory:
GUIDELINE OF ALTERNATION WITHIN AN IMPLUSE
" If wave two of an impulse is a sharp correction, expect wave four to be a sideways correction, and vice versa. "
Looking at our price chart, Wave (2) already unfold into a flat pattern and flat pattern is a side way correction. We can expect to see a sharp correction pattern for Wave (4)
BEHAVIOR FOLLOWING FIFTH WAVE EXTENSIONS
" ..when the fifth wave of an advance is an extension, the ensuing correction will be sharp and find support at the level of the low of wave two of the extension. Sometimes the correction ends there and sometimes only wave A ends there... Additional value is provided by the fact that fifth wave extensions are typically followed by swift retracements. "
Projection area and pattern for wave (4) retracement using Elliott Wave Theory for alternation and fifth wave extension theory, expecting to see a sharp correction in wave (4) toward 3900-3880 area.
Bottom line:
Short term view, looking for significant retracement for a sign that wave (3) rally has ended.
Long term view, we are still aiming higher to complete wave 3 cycle on a larger degree.
Trading above yesterday high will required reassesment on the structure.
