EUR/USD, GBP/USD, and Gold Prices Advance Impulsively
This is a recording of a US Opening Bell webinar from July 24, 2017.
EUR/USD has continued its trend to the upside. It appears we may be getting close to the end of a third wave in an impulse (view a webinar recording on impulse patterns, how to identify and trade it). If so, then prices may begin softening a bit towards 1.12-1.13 in a fourth wave later this week.
The recent GBP/USD break above 1.3048 opens the door towards higher prices. We are viewing this current move higher as a terminal and ending wave. There is a stiff wall of resistance and technical levels appearing near 1.3450. If prices make it up to this level, we are anticipating a reaction lower. If our wave count is correct, then this reaction lower could be the start of a new down trend.
We discussed this market in depth in the Q3 forecast for GBP written back in late June.
USD/JPY is another market where if the bulls are going to remain in force, they will need to show themselves immediately. The bullish wave picture allows a dip to today’s level, but that prices would need to take off higher for the bulls to remain in control. Otherwise, bears may push USD/JPY back down to 108.13 (April 16 low).
IG client sentiment in USD/JPY does favor a continued dip in pricing as sentiment currently prints near +1.73. Learn what this sentiment figure means and how to trade using it.
Finally, gold prices have found some support and zoomed higher. We think we may see one more increase to finish off the impulse, then a possibly correction back towards $1235-$1245. This impulse may finish wave ‘a’ of a zigzag pattern.
---Written by Jeremy Wagner, Head Trading Instructor, DailyFX EDU
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.