On the daily chart of the EUR/USD , the completion of a bullish divergence is observed today. Euro has reached a 50% correction to the downward impulse on January 14-28, 2022 and the resistance level is around 1.1313. These and other factors of our trading strategy give a signal for the growth of the Euro. We believe that the first wave of this growth has come to the end, as evidenced by the signals of a bearish (double) divergence on H1 chart.
It is too early to talk about the medium-term reversal of the pair's trend, however, already now we can assume the growth of the pair to the new local highs above 1.1500. Since the wave 1.11214-1.13298 is the first wave of the expected, at least a three-wave cycle, then the correction to it is assumed to be quite deep - at least 50%, and in the classical version of the wave cycle evolution - up to 61.8%. After the end of the correction, we expect growth to the levels of 1.1520-1.1540 (1.15382 - 200% Fibonacci extension from wave 1.11214-1.13298, 1.1520 – long-term level of support and resistance). To enter a trade at the end of the correction, it is necessary to monitor the situation at short timeframes (ideally, at M15).
Also, there is a version for a deeper correction - up to 100%, with an approach and even, possibly, with a short-term puncture of the low of 1.11214. In this case, we will see a classic double bottom or a figure close to it. So, the targets of 1.1480-1.1490 will become even more obvious.
How to trade.
Waiting for the end of the correction to the impulse 1.11214-1.13298. Reference point - Fibonacci correction levels and signals of indicators on the M15 charts. Open long in EUR/USD with targets 1.1520-1.1540, stop-loss - at the level of the correction minimum or at 1.1120.
A situation similar to the EUR/USD is emerging on the charts of the AUD/USD and NZD/USD.
It is too early to talk about the medium-term reversal of the pair's trend, however, already now we can assume the growth of the pair to the new local highs above 1.1500. Since the wave 1.11214-1.13298 is the first wave of the expected, at least a three-wave cycle, then the correction to it is assumed to be quite deep - at least 50%, and in the classical version of the wave cycle evolution - up to 61.8%. After the end of the correction, we expect growth to the levels of 1.1520-1.1540 (1.15382 - 200% Fibonacci extension from wave 1.11214-1.13298, 1.1520 – long-term level of support and resistance). To enter a trade at the end of the correction, it is necessary to monitor the situation at short timeframes (ideally, at M15).
Also, there is a version for a deeper correction - up to 100%, with an approach and even, possibly, with a short-term puncture of the low of 1.11214. In this case, we will see a classic double bottom or a figure close to it. So, the targets of 1.1480-1.1490 will become even more obvious.
How to trade.
Waiting for the end of the correction to the impulse 1.11214-1.13298. Reference point - Fibonacci correction levels and signals of indicators on the M15 charts. Open long in EUR/USD with targets 1.1520-1.1540, stop-loss - at the level of the correction minimum or at 1.1120.
A situation similar to the EUR/USD is emerging on the charts of the AUD/USD and NZD/USD.
Comment:
Sorry, there is a little mistake, the text "So, the targets of 1.1520-1.1540 will become even more obvious." is correct.
