Fri, Jun 09, 2023 @ 15:41 GMT
HomeContributorsTechnical AnalysisEUR/USD Builds Classical Bearish Trend Channel Towards 1.05

EUR/USD Builds Classical Bearish Trend Channel Towards 1.05

Currency pair EUR/USD

The EUR/USD is building a bearish trend channel (red/green line). Price should reach the 161.8% Fibonacci level of wave 3 (blue) before breaking the resistance (red) otherwise the channel is invalid. The angle of the support trend line (blue) is suggesting that the bearish momentum is slowing down.

The EUR/USD completed an ABC within wave 4 (green) and is now potentially retracing back towards the Fibonacci resistance of wave 4 (blue). A break above the Fibonacci resistance and trend line (red) invalidates the formation of a wave 3 (blue) and there could be a larger bullish ABC correction.

Currency pair GBP/USD

The GBP/USD is trying to break above the resistance trend line (dotted orange) of the larger contracting triangle chart pattern. This could lead to a potential breakout towards the larger resistance zone (brown). A bearish continuation could see price push towards 1.05.

The GBP/USD bullish breakout could lead to bullish momentum as part of waves 3 (orange/purple). A break below the support trend line (green) would invalidate the wave bullish trend.

Currency pair USD/JPY

The USD/JPY is building a bull flag (purple lines) after breaking above resistance (dotted red). A break above the flag could see price continue towards the next Fibonacci target of wave 3 (blue).

The USD/JPY broke below the support trend line (dotted green) which could indicate a larger wave 2 (brown) retracement. A bearish ABC zigzag (orange) could unfold towards the Fibonacci levels of wave C vs A and 2 vs 1.

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