EUR/USD corrects higher within the 4th wave
EUR Basket – the Euro continues to trade within a consolidating range. With resistance located at 595 and 596, I look for limited upside pressure. Rallies to be sold.
DXY (USD Index) - we have seen a correction to the downside. Support levels are located at 103.20 and 103.18. With the 61.8% Fibonacci support located at 103.19, I look for dips to be bought.
Correlation studies would suggest rallies to be sold in EUR/USD.
EUR/USD - the daily chart highlights the major currency pair breaking out of an expanding wedge formation to the downside. Buyers have emerged close to the 161.8% extension level of 1.0715. This suggests that the current move higher is a fourth wave correction in a bearish Elliott Wave count (5 waves). A common retracement level for a 4th correction is a 38.2% pullback of the last decline. This level is located at 1.0828. Bespoke resistance is located at 1.0821.
Conclusion: I expect intraday price action to be mixed and volatile. The prime short-entry area to join the medium-term bearish trend is between 1.0821 and 1.0828. A move above 1.0877 negates the bearish count.
Resistance: 1.0821 (bespoke), 1.0828 (38.2%), 1.0877 (swing low)
Support: 1.0722 (swing low), 1.0715 (161.8%), 1.0452 (261.8%)
DXY (USD Index) - we have seen a correction to the downside. Support levels are located at 103.20 and 103.18. With the 61.8% Fibonacci support located at 103.19, I look for dips to be bought.
Correlation studies would suggest rallies to be sold in EUR/USD.
EUR/USD - the daily chart highlights the major currency pair breaking out of an expanding wedge formation to the downside. Buyers have emerged close to the 161.8% extension level of 1.0715. This suggests that the current move higher is a fourth wave correction in a bearish Elliott Wave count (5 waves). A common retracement level for a 4th correction is a 38.2% pullback of the last decline. This level is located at 1.0828. Bespoke resistance is located at 1.0821.
Conclusion: I expect intraday price action to be mixed and volatile. The prime short-entry area to join the medium-term bearish trend is between 1.0821 and 1.0828. A move above 1.0877 negates the bearish count.
Resistance: 1.0821 (bespoke), 1.0828 (38.2%), 1.0877 (swing low)
Support: 1.0722 (swing low), 1.0715 (161.8%), 1.0452 (261.8%)
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.