EURUSD: Next Hurdle 1.1086

Ville Vainio

FOMC meeting was a non starter and the rhetoric remained same as the previous meetings. Basically Federal Reserve officials are looking for improvements in the labor market (wage growth and participation increase) and are looking closely at China.

As the rhetoric is same nonsense as before, market participants are still convinced that there is going to be a rate hike in the near future. I would say that if the rate hike is not going to happen in 2015, the likelihood of a rate hike in a presidential election year is far fetched.

Next hurdle on the downside is to reach below the 1st wave low at 1.1086 And once we have a clear 5 wave structure on the lower time frame charts (H1, M30) 3rd wave decline can be confirmed.The strong decline that started friday is signalling that minute wave 2 has ended and next impulsive wave (minute wave 3) has started. The length of the first wave decline from 1.173 to low of 1.1086 is about 625 pips and the next decline should be at least the length of the 1st wave.

Next hurdle on the downside is to reach below the 1st wave low at 1.1086 And once we have a clear 5 wave structure on the lower time frame charts (H1, M30) 3rd wave decline can be confirmed.

EURUSD 4 Hour Chart

EURUSD 4 Hour Chart

Source: forexdaybreak.com

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