FX.co ★ Wave analysis for EUR/USD on June 7

EURUSD - H4:

We continue to consider the situation for the EURUSD currency pair.

After the upward impulse wave 3, which was completed at the beginning of this year, we saw the downward fourth correction wave development. This correction is still being formed today. Judging by the internal structure, it takes the form of a triple zigzag [W]-[X]-[Y]-[X]-[Z].

Most likely, the market recently completed the development of the upward wave of the bond [X], then turned around and began to move in a downward direction, forming the initial part of a new wave. It is possible that impulse 1-2-3-4-5 is being built, where sub-waves 1 and 2 have already been formed, and pulse 3 is under development.

Consider the last section of the graph on H1.

EURUSD - H1:

After the end of the red impulse 1 and the upward zigzag correction 2, the market began to decline and form a bearish impulse wave 3. We can only notice the first two parts of this wave in the four-hour timeframe – the impulse [1] and the correction [2].

It is assumed that a descending impulse wave [3] is being constructed, which consists of sub-waves (1)-(2)-(3)-(4)-(5). In the near future, the price may fall to the level of 1.2068 in the wave (5).

At this level, the magnitude of the wave [3] will be 161.8% of the impulse wave [1].

In the current situation, you can consider opening short positions to profit at the specified level.