EURUSD & GBPUSD Decline Sharply after Bullish Rally 2016.01.05

EUR/USD

4 hour

The EUR/USD is expanding the wave X (brown) correction via WXY's (blue/purple).

1 hour

Yesterday the EUR/USD saw a bullish rally (wave X green) that was unable to break above resistance (orange). For the moment a bearish zigzag (orange) seems possible. The invalidation level is the trend line and 100% Fibonacci level.

GBP/USD

4 hour

The GBP/USD downtrend channel (red/green) is accelerating the bearish structure of the Cable. Price can keep falling towards the Fibonacci targets of wave 5 (blue) as long as price stays below the resistance trend line (red).

1 hour

The GBP/USD retested the resistance Fibonacci levels and trend lines and showed a bearish bounce as part of the wave 4 (pink). The subsequent price decline saw price move towards the 61.8% Fibonacci target. Price could perhaps extend the downtrend, unless it manages to break above resistance.

USD/JPY

4 hour

The USD/JPY has reached the bottom of the consolidation zone (blues) and has found support for the moment. The bounce also occurred at the 78.6% target, and if price manages to continue with its downtrend then the next target is the 100% Fibonacci level.

1 hour

The USD/JPY could build one more bearish fall as part of wave 4-5 (pink). The invalidation level is the bottom of wave 1 (pink) which is at 120.