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The USD turned up on Friday after much better than expected NFP figures and revision up for August. So, both numbers were supportive for the USD that rose strongly across the board.

Technically speaking, we were looking for higher USD. The EURUSD hits 1.2500 while GBPUSD breaks beneath 1.6000 level. There are some chances that USD pairs are in fifth waves and that corrections will come, but at the moment is important to stay in bullish mode with the buck and don’t be surprised by any extensions. With that in mind, even if EURUSD can be in fifth wave, it’s important not to turn bullish until we see five waves from the low. So for, I would stay “do or die” level for EURUSD down here. Let’s wait and see what happens.

EURUSD Elliott Wave Analysis October 6 2014 technical outlook currency trading

EURUSD 1h Elliott Wave Analysis

The one thing that also matters when it comes to trading is to focus on clear patterns across different markets. Per example, GBPUSD has a better bearish structure than EURUSD at the moment, so if we want to stay with the USD trend, then you could pay more attention to cable rather than EUR.

On GBPUSD we have seen an extension down from 1.6150 that we see as a completed wave iii) so the current bounce and slow bounce is probably a fourth wave that can stop around the 1.6000 psychological level. Be aware of further weakness in session ahead.

Elliott Wave Analysis October 6 2014 technical outlook currency trading GBPUSD
GBPUSD 1h Elliott Wave Analysis