the EUR/USD remains at a though spot and zone. The wave patterns remain unclear and dependent on the breakout direction. This wave analysis is showing two possible scenarios, one where a bullish a breakout could be part of wave 3 (green) and one where a bearish breakout could be part of wave C (brown).
The key levels for determining whether it’s a 123 or ABC are the trend lines and Fib levels: a bullish breakout above the 100% Fib level when comparing wave C versus A makes a wave 3 more likely whereas a bearish breakout below support (blue) makes a wave C probable.
The EUR/USD bearish retracement could either be a wave 1-2 (orange) pattern or completed a wave C (gold) within wave B (brown). The expected wave pattern will determine the most likely wave pattern and direction for this week.
The USD/JPY bearish breakout failed to break below the recent lows (blue line). Price is now a key decision zone: a bullish breakout above the 50% Fib invalidates the bearish wave structure whereas a break below the support trend line (blue) makes a downtrend continuation within wave 5 (blue) more likely.
The USD/JPY could have completed a wave 1 (orange) and is now building a potential wave 2 pullback (orange).