EURUSD may be working on a 3 wave rally from the 3/9 low. Proposed support for wave B is just under 1.1900…1.1887/99 is daily reversal support, the 61.8% retrace of the rally from the low, and 2 equal legs down from the 3/11 high. If this interpretation is correct, then price will rally into 1.2050/90 (month open is 1.2070 as well).
The 4th wave idea described yesterday looked promising for a few hours…then EURUSD blasted through 1.1950. Current pattern is unclear from my vantage point but the next upside level of interest looks like 1.2050/75. This is the 25 line of the bearish fork from the January high and the underside of the center line from the channel that originates at the March 2020 low. 1.1950 is now proposed support.
EURUSD has bounced from the noted 1.1845 ahead of ECB but strength may be short lived. The pop has the ‘look’ of wave 4 within a 5 wave drop from the March high. If this interpretation is correct, then price should roll over near 1.1950. Again, this is the median line and February low. It’s also where the rally from the low would consist of 2 equal legs. If this plays out, then the downside zone to target is 1.1695-1.1740. The top of the zone is VWAP from the March 2020 low (see futures chart below). The bottom of the zone is the 38.2% retrace of the rally from the March low. If 1.1950 doesn’t hold as resistance then I’ll reassess but the next level of interest would be 1.2050.
USDJPY nailed resistance and reversed (high today was 109.23). Simply, I am looking lower until roughly 107.00 (the next decision point?). Proposed resistance is now 108.80ish.
As forex traders, we keep our ears to the ground, waiting to catch any rumours or whispers concerning changes to interest rates and try to determine the significance of any interest rate decision.
EURUSD has reached 1.1845 (2 legs down). The 200 day average is about 1.1815. A bounce from either one of these levels wouldn’t be a surprise so watch for resistance now near 1.1950 (median line of short term bearish fork and February low). Another downside level to be aware of is VWAP from the March 2020 low at 1.1742. This is in line with the 11/11 low and lower parallel of the bearish fork. Bottom line, 1.1740s is the next most important downside level and 1.1950 is proposed resistance.
USDJPY is trading just above the July 2020 high and 61.8% retrace of the decline from the March 2020 high. A huge test looms near 109.20, which is the confluence of trendline resistance from the 2015 high and the bullish fork that originates at the November low. The median line from that fork is now possible support near 106.80. A close up view is below.
EURUSD broke below the center line of the channel from the March 2020 low and that center line is now proposed resistance if reached along with former support in the 1.2020/60 zone. The next 2 downside levels of interest are 1.1845 and 1.1600. The first level is 2 equal legs down from the high. The lower level is the 1.618 extension and the former 4th wave low (November low).
A well-defined base has formed in USDOLLAR since mid-February. Zooming into price action since the 2/25 low reveals an impulsive advance followed by a drop and today’s bounce. I’m of the mind that the drop and bounce compose waves A and B of a 3 wave pullback. Ideal support for the end of the pullback is 11634/51.