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Daily Technical Analysis: NFP Triggers US Dollar Strength And Bullish Rally


Currency pair EUR/USD

The Non Farm Payroll (NFP) and unemployment rate in the US were released last week Friday. The news and data cause US Dollar strength which has sent the EUR/USD downwards. The bearish reaction could indicate the end of wave 3 (green) and start of wave 4 (green).

The EUR/USD could be building an ABC (purple) correction within wave 4 (green). The bearish breakout below support (dotted green) seems to be a wave 3 (brown) which means that the current bullish price action could be a wave 4 (brown) retracement. The wave 4 is invalidated if price breaks above the 61.8% Fib.

Currency pair USD/JPY

The USD/JPY indeed completed a wave B (orange) as expected in Friday's analysis. Price is now above the resistance trend line (dotted orange) and falling wedge pattern, which could indicate a continuation within wave C (orange).

The USD/JPY is probably in a wave 4 (purple) as long as price stays above support (blue lines).

Currency pair GBP/USD

The GBP/USD broke below the support trend line (dotted blue) which could indicate a bearish breakout via a wave 1-2 (red).

The GBP/USD seems to have completed 5 waves (purple) within wave 1 (red) and is now building a potential ABC (purple) within 2 (red).

Author: Admiral MarketsWebsite:
Admiral Markets
The Wave Analysis it for today the most flexible, powerful and perspective tool which allows to predict tendencies which lead to certain changes on financial charts on all time pieces. One of properties of this tool is its insufficient formalisation, proceeding from it the opinion of the author of the forecast made on the basis of the Wave Analysis always is subjective. As the Wave Structure constantly varies, the forecast on the basis of the Wave Analysis reflects opinion of the author at the moment of the forecast publication. The Wave Analysis is not trading system. It not the generator of signals on the conclusion or an exit 1from the transaction, therefore the schematical direction of movement of the price put on the chart should not be for the trader the guide to action on opening of positions. In case of formation in the market of conditions which, according to the author it is possible to use for drawing up of the trading plan - on a chart levels of acknowledgement of the chosen scenario, optimum areas of an input and levels of cancellation of the chosen scenario will be specified in addition.
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