“Search, Analyse, Trade” is a series of analyses for Price Action and Elliott Waves. Its detailed step-by-step description can be found over here. I invite you to today’s review of selected currency pairs and potential trading opportunities.The analyses are based on the Dukascopy sentiment that can be seen here.
EUR/USD continues to decline after rejection with a Pin Bar at 1.1870 level. Declines reached 61.8 percent of the last wave of growth and we see an attempt to react. If the upward movement seen from the last low is to be a 1A wave, then we should see from this level a movement towards the recently rejected level within the 3C wave. No reaction, should lead to test the neck line of the head and shoulders formation.
The sentiment graph shows the balance between the players. For few days, we are seeing a decline in both long and short positions. The level of the pair and sentiment do not allow us to play, so what remains is observation and wait for more significant movement in some direction.
GBPUSD
A bit more you can read from the GBP/USD chart. Here, after rejecting the resistance zone with a Pin Bar, the observed downward movement slowly forms a impulse. To finish it a wave 4/5 is missing. After its possible formation two scenarios will be possible. In the first, it will be possible to mark it as wave 1A and after correction expect downward movement within wave 3C, which should reach the upward trend line. In the second, the resulting impulse would be considered as a C wave of irregular correction, ie, the wave 2B of the growth seen from the last low. In this case, we should see a continuation of the upswing and a re-test of the recently rejected resistance zone.
Just like on EUR/USD also here we have no clearer movement in the traders positions. Yesterday, we saw a slight drop in both long and short positions. Only the 3C wave and the rejection of the resistance level will be an opportunity to open a position but currently – when in doubt, I do nothing.
USDJPY
USD/JPY after Fakey formation and rejection of the support zone continued to rise to a certain point. They gains were stopped on 112,400. If we take a closer look at the graph, we will see that the resulting Pin Bar on the daily chart is an impulse. Currently, the pair should form wave c of irregular correction that reached the upper limit of the support zone. It is quite possible that today we will see another attempt within 3C wave. Such move should lead to a test of 113.100.
