Hi Traders,

Our weekly Elliott Wave analysis reviews the EUR/USD daily chart, the GBP/USD weekly chart, and the Bitcoin crypto currency daily chart.

EUR/USD Retracement Towards 1.05 and 1.08

The EUR/USD made a new low but price action was finally weaker, which is a first indication that a larger bullish retracement could take place:

1. The EUR/USD bullish divergence has appeared between the two recent daily bottoms (green lines on price chart and MACD).
2. The divergence pattern indicates a potential bullish reversal or retracement.
3. Because price action is probably in wave 3 (gray), we expect a shallow and choppy correction within wave 4 (gray) and not a larger reversal.
4. An ABC (yellow) pattern could unfold within a larger wave A (pink) of wave 4 (gray).
5. The bullish targets are the 23.6% Fibonacci retracement level near 1.0450 and 38.2% Fib near 1.08 of the wave 4 (gray).
6. The downtrend within wave 5 (gray) could aim at 0.9750, 0.95, and 0.925.

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GBP/USD Bullish Pullback to 1.2250

The GBP/USD is showing a massive bearish impulse but a strong support zone (blue) is now in its way:

1. The GBP/USD is expected to build a bullish retracement, just like the EUR/USD.
2. Considering the strong bearish momentum, we estimate that price action is probably in a wave 3 (orange).
3. This remains valid as long as the bullish retracement is not very impulsive and does not break above 1.25 and especially above 1.28 and 1.30.
4. A bullish ABC (green) is expected to complete the wave 4 (orange) around 1.2250.
5. The downtrend within wave 5 (orange) of wave 3 (yellow) could take price to 1.15 and perhaps 1.14 and 1.1250.

BTC/USD Bullish Bounce Aims at $30k

Bitcoin (BTC/USD) is testing the previous bottom and the main question will be whether price action will bounce or break:

1. BTC/USD is expected to make a bullish bounce according to our Elliott Wave analysis.
2. The current bearish price action is probably a wave B (orange).
3. This means that a bullish bounce should take price higher within a wave C (orange).
4. A larger ABC (orange) should complete a larger wave W (yellow) of a WXY complex correction (yellow).
5. The main bullish target is the 23.6% Fibonacci level around $30k.
6. A bearish bounce is expected at this strong resistance zone (red box).
7. After a bearish retracement in wave X (yellow), a bullish bounce should take price up towards the 38.2% Fibonacci level in a wave Y (yellow).

Good trading,
Chris Svorcik