EUR/USD Fed week with a small slide, as markets are doing some re-positioning.
What’s next for the pair? The team at Goldman Sachs examines the technical levels:
Here is their view, courtesy of eFXnews:
If this is truly a 4th of 5-waves, EUR/USD bears needs to avoid any overlap with the bottom of wave 1 (Sep. 3rd low) at 1.1088, argues Goldman Sachs.
“In other words, as long as the market holds below 1.1088, there’s still a good chance to see at least one more impulsive move lower. This would in turn complete the 5- wave bearish sequence that started at the August high,” GS clarifies.
“From current levels, wave 5 has potential to reach a minimum target of 1.0420 (if wave is equal to wave 1). An extended 5 th wave could reach as far as parity (1.618 times the length of wave 1).
Failure to hold below 1.1088 however means that this is in fact not a 4 th of 5-waves but actually part of a more complex corrective sequence,” GS argues.
“Bottom line, it means the market likely put in a meaningful low in November. The next retrace levels above are then at 1.1118 and 1.1258 (50% and 61.8% of the decline since August),” GS concludes.
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