EUR/USD bullish ABC zigzag faces robust resistance 2016.08.26
EUR/USD
4 hour
The EUR/USD remains in a large consolidation and the bearish breakout could take longer before materializing, which is the main reason why wave D (green) has been added. Once waves D (green) and E complete the triangle a strong bearish impulse is expected. For the moment price is respecting and pausing at the 61.8% Fibonacci retracement level. A bullish break above resistance (red) should see price move towards the 78.6% Fib. A bearish break below support (greens) at 1.1250 should see price start wave Y (brown) of wave D (green).
1 hour
The EUR/USD is showing slow and corrective bullish price action which is one of the reasons why a bearish count is preferred unless price manages to break above resistance (red). At the moment an ABC zigzag (blue) to complete wave W (purple) and an ABC retracement (blue) within wave X (purple) seems to be taking place. However, if price shows strong momentum that breaks resistance (red), then yesterday's wave count with a wave 5 remaining takes preference.
GBP/USD
4 hour
The GBP/USD bounced at the resistance top (red) of the daily downtrend channel. A break above this resistance (red) and the 78.6% Fibonacci retracement level makes the current wave count unlikely. In such a scenario the wave count would change to a larger ABC correction (purple). A break of support (green) confirms the bearish mode.
1 hour
The GBP/USD could be starting a new bearish wave 1-2 (purple) but this scenario is invalidated if price breaks above the 78.6% Fib. A break below support (greens) could start a bearish breakout towards +/-1.30.
USD/JPY
4 hour
The USD/JPY is building a lengthy contracting triangle (orange/green). Price will either break the support (green) for a downtrend continuation or break above the resistance (orange/red) and potentially start a reversal. The current wave 1-2 (blue) is invalidated if price breaks the bottom of wave 1.
1 hour
The USD/JPY has support (green) and resistance (red/orange) levels that mark a potential breakout.
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