Today's Support and Resistance levels:
S1: 124.54 R1: 125.51
S2: 124.04 R2: 125.90
S3: 123.40 R3: 126,48
Technical overview:
With a high at 125.90 there is a good possibility that the expected X-wave has finished and the downside pressure again is building. That said we need a clear break below 124.54 to confirm the top and building of renewed downside pressure. Looking at the correction since the 127.70 high, we have seen a zigzag correction, but we do think it is too small to correct all of wave 3. Therefore, we are looking for a new zigzag correction development that would likely take us down to 121.26, as the first target. At 121.26 wave 4 will has corrected 23.6% of wave 3, but a more normal corrective target will be at the 38.2% corrective target at 117.28, which also marks the bottom of wave iv of one lesser degree. For our count to stay valid, we should see a break above 126.95 at no point, as a break above here would call for a new rally higher towards 127.70.
Trading recommendation:
We have sold EUR at 125.70 and will move our stop lower to 125.95. If you are not short EUR already you can sell a break below 124.88 with the same stop.
