EURUSD & GBPUSD Decline Sharply After Bullish Rally

Daily Forex Technicals | Written by Admiral Markets | Jan 05 16 05:47 GMT

Currency pair EUR/USD The EUR/USD is expanding the wave X (brown) correction via WXY’s (blue/purple). Yesterday the EUR/USD saw a bullish rally (wave X green) that was unable to break above resistance (orange). For the moment a bearish zigzag (orange) seems possible. The invalidation level is the trend line and 100% Fibonacci level. Currency pair GBPUSD The GBP/USD downtrend channel (red/green) is accelerating the bearish structure of the Cable. Price can keep falling towards the Fibonacci targets of wave 5 (blue) as long as price stays below the resistance trend line (red). The GBP/USD retested the resistance Fibonacci levels and trend lines and showed a bearish bounce as part of the wave 4 (pink). The subsequent price decline saw price move towards the 61.8% Fibonacci target. Price could perhaps extend the downtrend, unless it manages to break above resistance. Currency pair USD/JPY The USD/JPY has reached the bottom of the consolidation zone (blues) and has found support for the moment. The bounce also occurred at the 78.6% target, and if price manages to continue with its downtrend then the next target is the 100% Fibonacci level. The USD/JPY could build one more bearish fall as part of wave 4-5 (pink). The invalidation level is the bottom of wave 1 (pink) which is at 120.

 

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Notes

The Wave Analysis it for today the most flexible, powerful and perspective tool which allows to predict tendencies which lead to certain changes on financial charts on all time pieces.

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In case of formation in the market of conditions which, according to the author it is possible to use for drawing up of the trading plan – on a chart levels of acknowledgement of the chosen scenario, optimum areas of an input and levels of cancellation of the chosen scenario will be specified in addition.

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EURUSD & GBPUSD Decline Sharply After Bullish Rally