GBP/USD Rallies 200 pips and Approaches 50% Fibonacci of Wave-4

January 06, 2017 07:00

GBP/USD

4 hour

The GBP/USD expanded the wave 4 (blue) correction via a WXY (orange) and has now arrived at potential resistance spots at the Fibonacci levels.

1 hour

The GBP/USD however could build one more higher high if price completes a wave 4 (brown) correction on the lower 1 hour time frame. A break below the 61.8% Fib invalidates the wave 4 (brown) and makes it more likely that the zigzag (grey) was completed at the recent top.

EUR/USD

4 hour

The EUR/USD is building a consolidation zone below the broken bottoms from the weekly chart (dotted green). The correction has been labelled as a wave 2 (brown), which would be invalidated if price breaks above the 100% Fibonacci level of wave 2 vs 1.

1 hour

The EUR/USD completed an ABC (green) zigzag and then expanded the correction as expected yesterday with a WXY (blue). Whether the EUR/USD has completed the correction or whether it will expand it will depend on the direction of the breakout. A bullish break above resistance (red) could see price move towards Fib levels. A bearish break below support (green) could see price move towards the next support (blue).

USD/JPY

4 hour

The USD/JPY seems to have completed a wave A (blue) of a larger ABC correction within the wave 4 (purple) correction. The 23.6%, 38.2%, and 50% Fibonacci levels of wave 4 vs 3 are potentially support levels for a wave 4.

1 hour

The USD/JPY seems to have completed a bearish 5 wave pattern within wave A (blue) of wave 4 (purple). Price could build a new ABC (brown) within wave B (blue) unless price breaks below support (green).

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