InstaForex: it is time for price retracement!

Market Leader informed

Wave analysis: Friday’s minimum is most likely to be the end of wave C. Yet, the whole structure resembles the horizontal triangular pattern, consequently now we can witness the 4th wave of the pattern – d. If the assumption is right then the current wave objectives are in the 1.4000 area, followed by a reversal for the downward 5th wave – e, with the closest objective around 1.3800.

Tech analysis indicates that the bullish retracement within the framework of working out the “sell” signal has already been terminated as the market will face another wave of the downtrend with the closest objective at 1.3750. That is why it would be logical to assume that wave d is finished and there will be some downtrend.

Fundamental analysis: this time there is little info to analyze. The US makes efforts to stimulate its national currency. On the other hand, Japan may seriously interfere with the market in the short run, waiting for info on the volume of the assets bought by the Fed Reserve. That is why now it is too difficult to make any forecasts basing on the results of the fundamental analysis. Consequently, we should currently rely only on the mentioned tech and wave analysis.

Final conclusion: both the wave and tech analysis confirm the scenario, according to which the retracement movement will be continued in the short run: a downward movement to the 1.3800-1.3750 area. However it is difficult to say what is going to happen at the market after the retracement. Yet the mentioned scenario is the most probable at the moment.

The current price at the time of writing the article is 1.3814.

Reasonability: at the moment the market is very likely to show flat, i.e. complex correctional pattern. That is why the wisest choice is to stay away from the market until the trend.

 

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