EUR/USD, GBP/USD face bounce and break spots in fragile triangles 2016.08.30

EUR/USD

4 hour

The EUR/USD stopped at the 38.2% Fibonacci retracement level of wave D (green) vs B. Any bearish break below that Fib level could see price extend the bearish breakout below support (dotted green) towards the 50% or 61.8% Fibonacci levels.

1 hour

The EUR/USD is building a small contracting triangle chart pattern (orange/green). A break below the support line (green) could extend wave A (blue) to a lower spot. A break above the resistance line (orange) could start a wave C (green) correction within wave B (blue) with resistance at the Fibonacci levels of wave B vs A.

GBP/USD

4 hour

The GBP/USD broke the support trend line (dotted green) after a strong bearish bounce at resistance (red) and 78.6% Fibonacci. A wave 3 (pink) needs to see price break below the previous bottom (horizontal green). A bounce at that bottom (horizontal green) would indicate a wave change and become a triangle.

1 hour

The GBP/USD is building a small contracting triangle chart pattern (orange/green). A break below the support line (green) could extend wave 1 (green) to a lower spot. A break above the resistance line (orange) could start a wave C (blue) correction within wave 2 (green) with resistance at the Fibonacci levels of wave 2 vs 1.

USD/JPY

4 hour

The USD/JPY broke the resistance (dotted orange) of contracting triangle (orange/green) but still faces strong resistance (red) at the top of the daily downtrend channel. A bullish break above it could start a larger bullish reversal (wave 1 purple).

1 hour

The USD/JPY immediately completed wave 3 (blue) as indicated in yesterday's analysis and retraced back to the 23.6-38.2% Fibonacci level of wave 4 (blue) where a bullish bounce took place. The breakout could head towards the Fibonacci levels of wave 3 vs 1.

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