EURUSD might have carved a meaningful top around 1.1420 levels, and the structure might be turning bearish in the short term. The currency pair is seen to be trading around 1.1280 levels as we prepare this article, and might find resistance around 1.1300 handle, going forward.
Alternately, EURUSD could re-test 1.1350 interim resistance, before resuming lower again. But kindly note that EURO might remain in control of bears until 1.1400/20 remains intact. The wave structure has been re-labelled on the chart presented today.
The drop between 1.1500 and 1.0636 in March 2020, could be the first impulse drop, with in the expected 5 waves at a larger degree. The entire structure between 1.0636 through 1.1400/20 could be seen as a corrective phase A-B-C, explained below.
The rally from 1.0636 through 1.1150 was an impulse, labelled as potential Wave 1/A here. This was followed by a sideways corrective triangle structure a-b-c-d-e, which terminated around 1.0775 levels, Wave 2/B on the chart.
Since then, EURUSD might have rallied to complete Wave 3/C towards 1.1400/20 respectively. If the above wave counts hold well, EURUSD should be preparing to drop lower below 1.0636, going forward. For this structure to remain intact, prices should stay below 1.1420 resistance.
Only a break above 1.1420 and subsequently taking out 1.1500 resistance will change the above bearish structure within EURUSD.
Short against 1.1420, targeting below 1.0636.
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