GBP/USD waves explain first bullish rally since Brexit 2016.07.13

EUR/USD

4 hour

The EUR/USD showed bullish intentions during yesterday's trading but was unable to break above resistance (yellow) and is now retesting support levels (green). This is part of a bigger correction of wave Y (purple) in wave 2 (brown) unless price breaks above the top (orange).

1 hour

The EUR/USD completed a wave C (green) after which it turned around for a bearish ABC zigzag (green) within wave X (blue). Price is now in a bullish bouncing spot unless price breaks below the 100% Fibonacci level.

GBP/USD

4 hour

The GBP/USD broke the bear flag channel (dotted green) and is showing bullish momentum for the first time since the Brexit referendum. The wave count, however, is still marked as bearish with a wave 1-2 (pink) due to the large GBP/USD decline prior to it. A break above the 100% level of '2 vs 1' invalidates the wave 1-2 (pink).

1 hour

The GBP/USD is showing strong bullish momentum in a steep channel (green/red). If price is in a wave 2 (pink), then a bearish turn at the 78.6% or a bearish breakout below the channel should occur.

USD/JPY

4 hour

The USD/JPY is expanding the wave B (green) correction unless price breaks above the 100% Fibonacci level (invalidation) or breaks above the resistance (red) trend line (other wave count becomes more likely).

1 hour

The USD/JPY is showing strong bullish momentum, which increases the change of a larger ABC (grey) unfolding. Price typically would retrace to the 38.2%-61.8% Fibonacci levels of wave 'B vs A' before moving higher.

Follow @ChrisSvorcik on twitter for latest market updates