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

Our weekly Elliott Wave analysis reviews the EUR/USD daily chart, the GBP/USD weekly chart, and the Bitcoin crypto currency daily chart.
The EUR/USD made a new low but price action was finally weaker, which is a first indication that a larger bullish retracement could take place.
Bitcoin (BTC/USD) is testing the previous bottom and the main question will be whether price action will bounce or break.

Chris Svorcik FS method

EUR/USD retracement towards 1.05 and 1.08

The EUR/USD bullish divergence has appeared between the two recent daily bottoms (green lines on price chart and MACD).
The divergence pattern indicates a potential bullish reversal or retracement.
Because price action is probably in wave 3 (gray), we expect a shallow and choppy correction within wave 4 (gray) and not a larger reversal.
An ABC (yellow) pattern could unfold within a larger wave A (pink) of wave 4 (gray).
The bullish targets are the 23.6% Fibonacci retracement level near 1.0450 and 38.2% Fib near 1.08 of the wave 4 (gray).
The downtrend within wave 5 (gray) could aim at 0.9750, 0.95, and 0.925.

GBP/USD bullish Pullback to 1.2250

The GBP/USD is showing a massive bearish impulse but a strong support zone (blue) is now in its way:

The GBP/USD is expected to build a bullish retracement, just like the EUR/USD.
Considering the strong bearish momentum, we estimate that price action is probably in a wave 3 (orange).
This remains valid as long as the bullish retracement is not very impulsive and does not break above 1.25 and especially above 1.28 and 1.30.
A bullish ABC (green) is expected to complete the wave 4 (orange) around 1.2250.
The downtrend within wave 5 (orange) of wave 3 (yellow) could take price to 1.15 and perhaps 1.14 and 1.1250.

BTC/USD bullish bounce aims at $30k

BTC/USD is expected to make a bullish bounce according to our Elliott Wave analysis.
The current bearish price action is probably a wave B (orange).
This means that a bullish bounce should take price higher within a wave C (orange).
A larger ABC (orange) should complete a larger wave W (yellow) of a WXY complex correction (yellow).
The main bullish target is the 23.6% Fibonacci level around $30k.
A bearish bounce is expected at this strong resistance zone (red box).
After a bearish retracement in wave X (yellow), a bullish bounce should take price up towards the 38.2% Fibonacci level in a wave Y (yellow).

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

Author

Chris Svorcik

FS method

Chris Svorcik is a trader, analyst, and educator with over 15 years of experience in financial markets, specializing in moving averages, market structure, and price patterns.

GBP/USD clings to gains near 1.3400

GBP/USD retreats after reaching a three-week high above 1.3430, challenging the 1.3400 yardstick on Thursday. Although easing political uncertainty in the UK helps the quid limit its downside, escalating tensions in the Middle East support the Greenback, keeping Cable under scrutiny.

EUR/USD: Daily gains appear capped by 1.1450

EUR/USD keeps the recovery in place and looks to consolidate its gains north of 1.1400 the figure at the end of the NA session on Thursday. The pair’s move higher appears in tandem with a modest pullback in the US Dollar despite geopolitical concerns in the Middle East remain unabated.

Gold flirts with two-day highs, approaches $4,130

Gold stages a modest rebound on Thursday, setting aside a three-day losing streak and managing to surpass the $4,100 mark per troy ounce. However, steady geopolitical tensions have revived concerns over persistently high global inflation, reinforcing expectations of higher rates across the board and somewhat curtailing the yellow metal’s upside potential.

AAVE eyes $100 after Stable Vaults launch

Aave edges higher above $90.00 at the time of writing on Thursday, amid broader price stabilization in the crypto market. The company has announced Stable Vaults, a platform that allows businesses to integrate fixed-rate stablecoin yield, mildly lifting sentiment in the ecosystem.

Japan may be changing its Yen strategy, but markets don’t look scared

Japan may be changing its intervention playbook, but that might not be enough to rescue the battered Yen. With USD/JPY hovering at four-decade highs, the currency’s weakness is being driven less by speculative pressure and more by a powerful structural force: the wide US-Japan rate gap.

Bye, forward guidance: How to trade when central banks choose silence

Central banks have spent years telling markets what might come next. Now, traders face the possibility that they say a lot less. From the Federal Reserve to the European Central Bank and the Bank of England, policymakers are pushing back against forward guidance.