this is a possible wave count on the EURUSD, providing a bearish scenario.
US bond yields are rising rapidly providing strength into the USD. the DXY is currently trading under a key trend line resistance (see the comment section below).
FED Chair Jerome Powell has attempted to calm inflation fears this week during his testimony, however the market appears to be ignoring his comments.
Initially, we thought wave 5 had not completed, however, if there is a break back below the neckline of the inverted head and shoulders formation, then we can assume a top is in place and we are set for a deeper correction.
If anyone has any other wave counts please share below in the comment section!
Trade active
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The EURUSD is coming into the 1.618% FIB extension around the 1.1720 support.
Over the past couple of weeks, the key theme the market has been concentrating on has been rising interest rates on US Treasuries resulting in a risk-off sentiment.
The question now is are we approaching a bottom on the corrective structure, or has the USD got more legs to the upside.
@fxing, keep an eye on the recent 1.2240 top, if that is taken out then bulls are back in. I am waiting for a move towards the 1.21 support zone before entering the short side. Good luck!
@vincent007, Thanks for your input, do you have any analysis behind your suggestion?
vincent007
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@CKForexKings, Yes up short term as you can see...then down
Trading_Tony
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Looks like the corrective structure on the EURUSD has complete around the 1.618% FIB extension.
Ideally we will now see a 5 wave rally to kick start a new bull run on the pair.