Since the DXY has an early 4-hour upward pattern, we expect it to rise to the daily supply zone today. (Resistance needs to be tested for the dialy downtrend to continue.)
If so, EURUSD should come down to the daily demand zone.
The problem starts here.
(First) If EURUSD succeeds in rising in the daily demand zone, it may rise towards new highs by early next week. And a retracement will come,
but since the weekly demand zone is above, after the correction, the conditions to rise again become better.
(Second) However, if the daily demand zone shows a correction pattern, a daily downtrend may begin.
It may continue to decline until it finds the weekly demand zone below.
If it shows an uptrend pattern in the weekly demand zone again and turns upside down, it is propagated as a weekly uptrend wave and can renew the high again.
Conversely, if it fails, the bottom can be renewed as the monthly correction process ends and leads to a daily downward wave.
In conclusion, market action in the daily demand zone will change the overall pattern.
If so, EURUSD should come down to the daily demand zone.
The problem starts here.
(First) If EURUSD succeeds in rising in the daily demand zone, it may rise towards new highs by early next week. And a retracement will come,
but since the weekly demand zone is above, after the correction, the conditions to rise again become better.
(Second) However, if the daily demand zone shows a correction pattern, a daily downtrend may begin.
It may continue to decline until it finds the weekly demand zone below.
If it shows an uptrend pattern in the weekly demand zone again and turns upside down, it is propagated as a weekly uptrend wave and can renew the high again.
Conversely, if it fails, the bottom can be renewed as the monthly correction process ends and leads to a daily downward wave.
In conclusion, market action in the daily demand zone will change the overall pattern.
Trade active:
If the rebound fails in the daily demand zone, a weekly correction is expected. In other words, it is more likely to fall towards a low rather than rise and renew a high.
Trade closed: target reached:
It rebounded in the daily demand zone, but this analysis is no longer valid as the pattern may change.