The entire month of July, we have waited patiently for EURUSD to produce a top and reverse. This week finally seems critical for several instruments across the board for forming major tops and bottoms and hence several articles and trading plans shall be submitted to plan for this week and the next series to follow. A bigger picture is presented here (weekly chart), and it clearly suggests that the pair has either worked out a W, X, Y or is unfolding an A, B, C (c will unfold into 5 waves) around the 1.1600/1.1700 resistance zone. On shorter time frames, the pair looks to have completed an ending diagonal wave structure and might be looking to reverse either from here or between 1.1700/1.1800 levels. Resistance is strong here and with the series also approaching its last trading days, we remain optimistic for a bearish turn.
Initiate short positions now (1.1640/45), stop at 1.1750, target is open.
GBP/USD chart setups:
As in EUR/USD, we have presented a bigger picture in GBPUSD as well with daily chart outlook. The pair looks to be working out on a major top at 1.3120/30 levels, which can be defined as wave (4) at a higher degree. The pair has slowly carved out its wave (4) resistance since past several months as seen here, and if this holds to be true, the next big move should come on the south side. A great confidence on the bearish setup would come on a break below 1.2800 levels but a slightly aggressive approach would encourage a bearish move from here itself. Strong Fibonacci 0.786 resistance has stalled prices till now at 1.3120 levels and the pair should face pressure lower from here.
Please remain short from here, stop at 1.3150 targets 1.2800, 1.2600 and lower.
There is no major fundamental event lined up for the day ahead.
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