EUR/USD, GBP/USD offer firm invalidation and confirmation levels 2016.07.27

EUR/USD

4 hour

The EUR/USD has not been able to break the bottom of wave 1 (brown), which is increasing the chance that a larger correction is taking place rather than a trend continuation via waves 3 (purple/brown). The wave count is vulnerable to change, especially if price breaks above the resistance trend line (red). A break below support (purple/green) would however make a wave 3 (purple) more likely again.

1 hour

The EUR/USD is building a bullish channel (purple). A bearish breakout could indicate the completion of wave 2 (blue). A bullish break above resistance (red) and 100% Fibonacci level invalidates wave 2 (blue).

GBP/USD

4 hour

The GBP/USD is still in a triangle chart pattern (green/red). Whether the Cable is bullish or bearish will depend on the direction of the breakout. Price is either in a bearish 123 (pink) or in a bigger ABC retracement (purple).

1 hour

The GBP/USD is building a correction (orange / green lines) and has been moving sideways for a while. A break below the support trend line is needed before a wave 3 (blue) could be expected. A break above the 100% Fibonacci level invalidates wave 2 (blue). The Fibonacci levels should act as resistance.

USD/JPY

4 hour

The USD/JPY made a bearish correction towards the 38.2% Fibonacci level, which was then used for a bullish bounce. So far the bounce has shown significant bullish momentum. A breakout above the resistance trend line (red) could indicate a larger trend change.

1 hour

The USD/JPY is probably building an impulse, which at the moment is most likely a wave A (blue) of a larger ABC.

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