Divergence on Forex Majors Leads to Rebound 2015.08.31
EUR/USD
4 hour
The EUR/USD could be bouncing at the support trend line (green) but a turn on the oscillator would confirm that potential for a bullish bounce.
1 hour
The EUR/USD created divergence (purple) and is now challenging the resistance trend line (orange), which could cause a potential ABC correction (green). Whether the wave count is an ABC (green) or a potential 123, remains to be seen and depends partly on how strong the current bullish bounce behaves (corrective or momentum).
GBP/USD
4 hour
The GBP/USD bounced off the horizontal support level (green) which could indicate a potential retracement (see 1 hour chart). Any potential break below the green line this week indicates a breakout below a daily and weekly support level.
1 hour
The GBP/USD expanded the 5th wave (orange) and has now divergence between the most recent bottoms (purple) line. This could cause price to retrace back to the long-term moving average via an ABC correction (pink).
USD/JPY
4 hour
The USD/JPY should not retrace deeper than the 78,6% Fibonacci level otherwise the wave count change will change to an ABC instead of a 123 (purple).
1 hour
The USD/JPY is moving upwards in a channel. There is divergence present (purple line) on the oscillator which is a first indication that the bullish price action could be losing steam.