The Dollar Triangle

The EUR USD pair is in an ongoing TRIANGLE structure. TRIANGLE are five legged counter trend structure (a-b-c-d-e). The e leg falls around 1.305 levels. This is a turn around level for us. There are many reasons why we think the currency is an ongoing counter trend corrective structure, which is preparing to turn down back to sub 1.23 previous low levels.
Corrective structures are clearly overlapping, like the current case. Prices are moving between 1.31 – 1.24 levels since 27 OCT. The larger the sideways action bigger the trend after it. The current sideways formation of nearly two months could give at least a multi week of trend down. TRIANGLE (SLIDE 1) are also continuation patterns. The previous trend remains down and this is where the current formation should resolve.
Moreover, our PREFERRED negative view on the pair is validated by the over reactive momentum. RSI, MACD and most of the oscillators are moving disproportionately against the price. This means that prices are indeed corrective in nature. Above this we also have the psychological primary symmetry, which suggests 1.2 levels sub 1.35 levels (SLIDE 2)
A similar aspect of over reactive momentum can also be seen on the dollar index (SLIDE 3). In case the respective turn level fails to push prices dollar, the counter trend structure could see a push up higher till 1.33-1.325 levels. After which we still see a lower resolution. A push higher above 1.305 still remains a low probability scenario for us.
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