EURUSD might be unfolding towards 1.2050 to terminate Wave 2 of (C), before turning lower again. The currency has taken out initial resistance above 1.1800 in the past two trading sessions and might produce a corrective drop towards 1.1720/30, before resuming its rally.
EURUSD had carved a meaningful top around 1.2350 in January, before reversing lower. The currency is unfolding a corrective (A)-(B)-(C) at a larger degree, which could terminate towards 1.1300 mark. Within the above corrective structure, Waves (A) and (B) could be in place around 1.1704 and 1.2266 respectively.
Since then, Wave (C) might be unfolding and eventually push prices lower towards 1.1300 in the next several weeks. Going further into the sub waves within Wave (C), EURUSD seems to have carved Wave 1 between 1.2266 and 1.1660 respectively.
If the above structure is correct, a potential Wave 2 is being carved out towards 1.2050 levels. Also note that fibonacci 0.618 retracement of Wave 1 is passing across 1.2030/35 levels. High probability remains for a bearish bounce, if prices push towards 1.2030/50 zone.
Traders might be preparing to initiate fresh long positions from 1.1720 mark with a potential risk below 1.1660 respectively.
Finacademy Technical Team
USDJPY could be progressing into a counter trend rally toward 114.30-50 zone in the next few trading sessions.
Gold dropped to $1770 mark on Tuesday before finding some support. The yellow metal is still testing its intermediate trend line support connecting $1721 and $1758 levels respectively.
The US dollar index carves a meaningful top around 96.88 mark over the last week. The index reversed sharply on Friday confirming a bearish Evening Star candlestick pattern on the daily chart.