Weekly waves: EUR/USD, GBP/USD and Bitcoin

EUR/USD bullish breakout expected for push to 1.05

The EUR/USD is building a contracting triangle chart pattern. Let’s review what to expect with the next price swing:

1. The EUR/USD seems to be building a sideways consolidation after price action showed a strong bullish impulsive with 3 bullish daily candles.

2. The bullish momentum is probably a wave A (yellow) and the sideways triangle pattern is expected to be a wave B (yellow).

3. Usually these patterns show a bullish breakout (blue arrow) to complete wave B and start wave C (yellow).

4. However, a bearish breakout does not invalidate the wave B (yellow) as long as price action stays above the Fibonacci retracement levels of wave A.

5. The main target for the wave C is the 38.2% Fibonacci retracement level near 1.05.

6. A breakout above the resistance line could indicate the start of the wave C (yellow).

7. A bearish bounce at the 38.2% Fibonacci level could complete the ABC (yellow) within wave W (pink). 

8. A larger WXY (pink) correction could occur within wave 4 (gray) as long as the shallow resistance Fibs are respected.

GBP/USD bearish ABC towards 1.19-1.20

The GBP/USD is building a bearish retracement but a key support zone is nearby:

1. The GBP/USD also seems to be building an ABC (yellow) pattern.

2. The wave B (yellow) could make a deeper retracement towards the inverted head and shoulders support level (purple).

3. A bullish bounce could aim at the 38.2% Fibonacci resistance level near 1.25.

4. The ABC (yellow) could complete a wave W (pink) of a larger WXY (pink) in wave 4 (gray).

5. A bearish ABC bounce could emerge within wave X (pink) at the 38.2% Fibonacci level.

BTC/USD breaking above key resistance

Bitcoin (BTC/USD) seems to be building an uptrend after creating several higher highs and higher lows:

1. BTC/USD has broken above the daily highs of the past several days.

2. The bullish breakout could indicate a bullish continuation after BTC/USD already managed to show several higher highs and higher lows.

3. The main target of the 5 wave pattern (yellow) within a larger ABC (pink) pattern is at the 30k price level near the 23.6% Fibonacci retracement level.

4. A break below the bottoms would invalidate the bullish reversal.

5. A larger WXY (blue) complex correction could take place within the expected wave B (gray) correction.

---

The analysis has been done with the indicators and template from the SWAT method simple wave analysis and trading. For more daily technical and wave analysis and updates, sign-up to our newsletter