EUR/USD hits major 78.6% Fib after breaking consolidation zone 2016.09.09

EUR/USD

4 hour

The EUR/USD has reached the 78.6% Fibonacci level of wave X (purple) and the resistance trend line (red). This zone will either cause a bearish turn or a bullish break. A bearish reversal confirms the development of a wave X (purple) within wave D (green). A bullish break indicates that a different wave X (brown) is still ongoing.

1 hour

The EUR/USD broke above the sideways consolidation zone (dotted orange) to complete wave 4 (green). The bullish breakout for wave 5 (green) was short and the bearish reaction at the 78.6% Fib could be explained by a wave 1 (green). A break above the origin (100% Fib) invalidates wave 1 but a break below support (green) makes a bearish breakout more likely.

GBP/USD

4 hour

The GBP/USD is an ABC zigzag correction (green/pink) after the break of the daily resistance trend line (dotted red). The Fibonacci levels could be targets for the C waves.

1 hour

The GBP/USD made a retracement via an ABC zigzag (purple) to the 38.2%-50% Fibonacci retracement level of wave 4 (blue) vs 3. A break above resistance (orange) could confirm the start of wave 5 (blue) with targets at the Fib levels.

USD/JPY

4 hour

The USD/JPY has bounced at the 61.8% Fibonacci level of wave 2 (purple), which is invalidated if price breaks below the 100% Fibonacci level. A break above resistance (red) confirms the end of the downtrend.

1 hour

The USD/JPY could be building deeper pullbacks via wave multiple wave 1-2 formations. This would be confirmed if price manages to break above resistance (orange). A break below support (purple) invalidates the wave 1-2 and makes a pullback to the 78.6% Fib of the 4 hour chart likely.

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