EUR/USD risks deeper decline as three-wave recovery appears complete

After slow price action on EUR/USD between the 1.17 and 1.18 levels, we are now seeing more serious and important turn lower, so there is clearly some bearish pressure building for the euro, especially if we consider that the market already overlapped the 1.1633 level that we highlighted before. Usually, this suggests that the recovery from the March lows unfolded in three waves and that the bearish trend may be returning. If we see a break below the potential base channel and later also below the trendline support 1.1550, then the odds would increase for a continuation back towards the March lows at 1.1412.

If we get some new fresh rebound, then we are likely in a triangle here.

Also, when looking at the daily chart and this current reversal lower towards 1.1630, it makes us think that sooner or later a higher degree wave C could appear and bring the pair back towards the 1.1300 to 1.12 area shown on the updated wave structure.