EUR/USD forecast

   After retracing from level 1.4010 (“K” trend line) and rising above resistance level 1.4150 (the lower bound of “a-a+” sideways trend), the pair has jumped up quickly and found itself at a strong level of resistance accumulation 1.4300–1.4340. Therefore, a neutral trading corridor is established now between resistance 1.4340 and support 1.4150, within which a turning figure may be formed.

   In case the pair rises above level 1.4340, it is supposed to reach level 1.4550. But according to technical picture at daily graph, this is unlikely to happen (see D1 forecast).
   Otherwise, if the pair drops below support 1.4150, it will get down to support 1.3940 (the lower bound of “M-M+” daily sideways trend – “M” trend line).

   I do not recommend trading in the range between levels 1.4300 and 1.4150, since there is a high probability of switching to a sideways trend (a trend-turning figure formation). I recommend selling under condition of drop below support 1.4150 with a target at 1.3940. Alternatively, you may carefully (driven by a clear signal only) buy above 1.4360 with a target at 1.4550 (however, this variant is less preferable because of lower probability).

 

   The pair is set against the accumulation of resistance 1.4100 and 1.4400 formed by “E” and “F” trend lines correspondingly. These are very strong trend lines. Moreover, “Z” trend line passes through level 1.4400, what further increases the importance of this resistance thus making it a key one. Such a huge accumulation of resistances as well as the pair’s exit from “B-B+” trend both are speaking about formation of the 4th correctional wave, which is supposed to have its target set down to accumulation of supports between 1.3285 and 1.3550.

   A "triangle” figure is observed at the graph now (it is formed by “K” and “M” trend lines). The pair has broken up above the higher bound of a “triangle”. Basically, this is speaking about the pair’s intention to rise to 1.46, but it is unlikely to happen because the market is set against key resistance 1.4260 (“E” trend line) as well as against the higher bound of a fresh “M-M+” sideways trend (these levels are showing a very strong resistance, which suppresses the pair’s upside). Therefore, this “triangle” will soon be converted to a “double top” figure having its bottom in the form of “M” trend line – the lower bound of “M-M+” daily sideways trend.

   We were given a first sign of trend’s turn – the rebound off resistance 1.4260. Another confirmative sign will be the pair’s drop below 1.4110. Next, downtrend will become more confident upon passing level 1.4000. Drop below level 1.3900 (around the lower bound of “M-M+") will be a certain signal of further dropping to 1.3550 and, possibly, to 1.3285 in case 1.3550 doesn’t offer a decent support.

 

 

   The pair is set against the accumulation of supports 1.4100 and 1.4400 formed by “E” and “F” trend lines correspondingly. These are very strong trend lines. Moreover, “Z” trend line passes through level 1.4400, what further increases the importance of this resistance thus making it a key one. Strengths and chances are equal so, basically, either 1.4100 or 1.4400 may become a turning level (we shall examine daily graph for details). In the 4th correctional wave, the pair will go for a correction from one of these levels to support level 1.3285 and then, in the 5th wave, it will head to the maximum 1.4720 to update it (level 1.4720 update is assumed by the picture at daily graph as well as by the fact that “Y” trend line got broken). All these five waves will make up the “D-D+” uptrend; its extremum will be found at resistance level 1.4935 or 1.5300.

 

 

   Strategically, the graph shows that the pair is developing a downtrend having the target set to level 1.1000 (“Q” trend line). This situation took effect after the “P-P+” uptrend had been broken along with “E-E+” trend and “F” trend line. But there are reasons that until the maximum 1.4720 is updated, the pair is unable to develop a downtrend to 1.1000. That reasons are well seen on weekly graph. Besides, it’s a simple logic that the pair can’t go to 1.1000 from current levels prior to formation of a trend-continuing figure (like “flag”, which is being formed now) or a side trend which would update the maximum 1.4720 (basically, such side trend is the same “flag” figure).
   Above the level 1.4720 is an accumulation of resistance levels 1.4935 and 1.5300 (these levels are examined in detail at weekly graph). Hence, after updating the maximum 1.4720 the pair will push off 1.4935 or, if it will get over 1.4935, off 1.5300 (which is a key level). Accumulation of these resistances is meant to become a turning, key level for the pair; and a supporting point for the “flag” figure’s higher bound. From there, the market will develop a downtrend aimed at the figure’s lower bound, roughly at level 1.2800. After passing that level the “flag” figure will have been executed and the next dropping target will be set to level 1.1000 (“Q” trend line). Then, a correction is supposed to be performed from there to level 1.3000 and down again to 1.0000.
   I would like to note that the feeling arises as if the right shoulder of a “head and shoulders” trend-turning figure is being formed now, however we definitely won’t see a clear “head and shoulders” figure there, especially if the pair goes up to level 1.5300. The neckline will get falsely broken for multiple times due to invalid figure proportions. That’s why it is better to get oriented to the “flag” figure (which virtually is the right shoulder of a “head and shoulders” figure).