Expect the EURGBP to reach the former 4th wave congestion zone (.7391-.7612) over the next few weeks. Near term, the advance from .7766 is wave B in the A-B-C decline from .8097. A push above .8034 would suggest that a triangle is unfolding since the .8097 high.
We wrote last time that “the advance from 1.5326 is in 5 waves, indicating that a 3 wave correction is expected in the coming week. Another 5 wave advance is then expected. What does this mean for the larger pattern? With a larger bull move now expected, the decline from 1.6827 is treated as wave C of an A-B-C expanded flat.” The correction is unfolding as expected. There is potential support from the 5/9 low at 1.6066. The Fibo support zone is 1.5975/1.5727.
A 3 wave correction is likely complete at 1.5278. The next bull leg is expected to exceed 1.6324. Near term, 1.5500/50 should serve as support and price ideally remains above 1.5426.
Trend is considered bullish as long as price is above 1.5919. Since 1.5491, advances have unfolded in 5 waves and declines in 3 waves (the drop from 1.7426 is in 5 waves but is a C wave that completes a flat correction). As long as the EURAUD is above 1.5919, there is longer term potential for the pair to exceed 1.75.
The EURNZD is expected to eventually exceed 2.1187. Bulls should keep risk to 1.9582. Coming below would likely see the pair test support in the 1.8960-1.9237 zone, which would present an opportunity to align with the bullish trend at a lower price.
Tell us what you think about this report: contact the strategist about the article at jsaettele@dailyfx.com
TREND ANALYSIS is based on a rolling pivot model. LONG TERM TREND is determined by the last 3 months of price data (high, low, close). SHORT TERM TREND is determined by the last 4 weeks of price data (high, low, close). R3, R2, R1, PL, PH, S1, S2, and S3 are provided to aid in identifying entries and exits. These are objective measures and our subjective analysis (STRATEGY) may differ.
SCHEDULE
Monday: EURGBP, EURCHF, EURCAD, EURAUD, EURNZD
Tuesday: EURJPY, GBPJPY, CHFJPY, CADJPY, AUDJPY, NZDJPY
Wednesday: GBPCHF, GBPCAD, GBPAUD, GBPNZD
Thursday: AUDCHF, AUDCAD, AUDNZD