The EUR/USD pair seems to have completed the diagonal structure as depicted on the hourly chart here labeled 5 waves A through E. Furthermore, the pair seems to have also resumed its downtrend according to the bigger picture discussed earlier and has already completed waves 1 and waves 2 respectively towards the same. If this wave structure holds true, the pair can be expected to continue dropping lower into waves 3,4 and 5 of the same degree. Immediate short term targets are seen at 1.0700 and 1.0600 levels respectively. Please note that the pair has got the potential to drop towards parity levels in the coming weeks. Immediate resistance is seen at 1,0782 levels, while support is seen at 1.0700 levels respectively. The above wave structure would change only if prices break above 1.0782 levels and subsequently above 1.0850 levels.
Please remain short for now, stop at 1.0850, targeting 1.07 and 1.06 (short term, 1-2 days)
USD/JPY chart setups:
The USDJPY hourly chart suggests that it has completed the corrective drop that had begun from 115.50 levels earlier. Please note that the drop has unfolded into corrective A-B-C three waves as labeled here. Also, note that wave C has unfolded into 5 sub waves labeled waves i through v respectively. The above wave structure indicates that USDJPY has formed a meaningful bottom at 112.45 levels, and should be looking to push higher from here. If this wave count holds true, the pair is expected to print higher highs and higher lows from here and potential remains to push above 118.00 levels going forward. The short term targets are 113.50 levels as depicted here. Immediate support is seen at 112.44 levels while resistance is at 113.45 levels respectively.
Please turn long now, stop at 112.10, targeting 113.50 and higher.
USD might have got beaten up across the board last week but it still remains bullish till critical support levels are held up. With no major fundamental announcements today during the New York Session please find trade volatility as normal and as discussed above.
The material has been provided by InstaForex Company – www.instaforex.com