Technical Analysis

Daily Technical Analysis: EUR/USD Turns Bearish After Hitting 61.8% Fibonacci Target At 1.0775


Currency pair EUR/USD

In yesterday's trading the EUR/USD broke above the 50% Fibonacci retracement level of wave 2 (brown) and continued with a bullish push towards the 61.8% Fib at 1.0775. Price stopped at this Fib level and made a bearish retracement, which is now testing the support trend line (blue) – see 1 hour chart.

The EUR/USD completed a wave 5 (pink) as expected in yesterday's wave analysis. Price is now at the trend line (blue) which is a bounce or break spot. A bearish break could indicate a first signal that a bearish reversal is occurring.

Currency pair EUR/USD

The GBP/USD remains at the 61.8% Fibonacci level of wave 4 (purple). The consolidation zone could indicate a potential reversal or a sideways zone for a new bullish breakout towards the 78.6% Fibonacci level.

The GBP/USD retracement is a bull flag chart pattern which has reached the 38.2% Fibonacci retracement level at 1.2750. A break below the 61.8% Fibonacci level invalidates wave 4 (purple) where a break above the bull flag (red) could see a wave 5 (purple) develop.

Currency pair USD/JPY

The USD/JPY is building a bear flag chart pattern within a wave 4 correction (orange), which would become invalid if price retraced above the bottom of wave 1 (red line). A break below the bottom of the bull flag (blue) could indicate a bearish breakout and completion of wave 4 (orange).

The USD/JPY is building an ABC (purple) zigzag correction towards the Fibonacci levels of wave 4 (orange).

Author: Admiral MarketsWebsite:
Admiral Markets
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. One of properties of this tool is its insufficient formalisation, proceeding from it the opinion of the author of the forecast made on the basis of the Wave Analysis always is subjective. As the Wave Structure constantly varies, the forecast on the basis of the Wave Analysis reflects opinion of the author at the moment of the forecast publication. The Wave Analysis is not trading system. It not the generator of signals on the conclusion or an exit 1from the transaction, therefore the schematical direction of movement of the price put on the chart should not be for the trader the guide to action on opening of positions. 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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