EURUSD has largely stayed below 1.14 this week after the bullish run paused at 1.1412. The following technical analysis is based on the Elliott wave theory.
June 27, 2019 | AtoZ Markets – After hitting 1.1412 on Tuesday, EURUSD has dropped – first to 1.1345 and then a recovery to 1.139. It has largely stayed below 1.14 this week. On Wednesday, the price was pushed to 1.1346. Currently, in the London session today, a rally to 1.137 is ongoing and it remains to be seen whether the bulls will get back in control.
The US-China trade talks which have been making headlines since 2018 is still inconclusive. However, recent reports suggest that the deal is re-opened and a truce will be agreed. The two countries have reportedly agreed to withdraw the huge tariffs sanctioned on each other as they renegotiate to make a new deal. Presidents Trump and Xi will meet on Saturday in Japan. The German inflation data is the major Euro-zone data today before the US Final GDP q/q is released just at the start of the New York session. The second and third revisions of the first quarter are expected to be unchanged at 3.1%. The initial release came at 3.2% before the first revision at 3.1%.
EURUSD analysis: important price levels
The most important resistance level remains at 1.1412. A break above this level will get back the bulls on track. EURUSD could then surge to 1.145, 1.1512 and 1.157. On the downside, an intraday support has been formed at 1.1345. A break below will see the current dip continue to 1.13 or 1.127. 1.118-1.12 will be broken downside if the long term bearish trend would resume.
EURUSD Elliott wave analysis
In the last update, where the chart below was used, we had two possible high likely scenarios. The rally from 1.112 to 1.1412 looks corrective. The bearish trend could resume and drag the price to 1.105-1.10 bearish target levels.
On the other hand, there could be a (i) – (ii) – i -ii (one-two-one-two) price arrangement before the bullish trend resumes. Whatever the case will be, at least a dip to 1.127-1.13 is expected. Price has dropped as expected. This could continue as the new chart below shows.
The current minor rally is expected to remain below 1.14. A break below 1.1345 will confirm the continuation of the bearish move to 1.13-1.127 zone. We will see what happens from there.