I expect to see EU return to its pre-FOMC consolidation zone in the coming week; a lack of data on both sides of the pair should leave the markets to fluctuate organically and (presumably) return to more stable structure. In this case, the consolidation zone that formed the day before the Fed released its July minutes. Several structural levels have grown out of the original post-FOMC rally, which roughly correlate to the . 618 retracement
and its inverse, the . 382 retracement
. At the .382 level, a head and shoulders
phenomenon is beginning to form; rather than the traditional "swing high - swing higher - swing back down again" format of the head and shoulders
pattern, my chart tracks multiple points of resistance that conform to the "resistance - breakout - return to resistance" nature of a head and shoulders
pattern. While I would not be surprised to see continued activity between the 618 and 382 levels, I believe price action will ultimately return to last week's structure.