Weekly Waves 12 September: EUR/USD, USD/JPY and Bitcoin

EUR/USD Bullish Reversal After Strong Weekly Candle

The EUR/USD is showing a strong bullish weekly candlestick, which is expected to start a bullish correction

1. The EUR/USD is building a bearish wave 3 (gray) impulse.
2. However, the bullish weekly candle is expected to signal the end of wave 3.
3. The strong bullish weekly candle looks like a strong reversal candle with a lower low but also a higher high and a close near the high, indicating buying pressure as last week closed.
4. A break above the resistance zone (red box) and last week’s high should start a bullish impulse higher.
5. This could start a wave A (pink) within a larger ABC (pink) correction of wave 4 (gray).
6. The 23.6% and 38.2% Fibonacci retracement levels are expected to act and hold as resistance. A break above the 38.2/50% Fib zones could indicate a different wave pattern.

USD/JPY Bullish Bounce at 38.2% Fibonacci Level

The USD/JPY uptrend has been extremely strong since March 2022 with a price movement from 114 to 145 in a matter of months:

1. The USD/JPY bullish impulse is very strong and is therefore expected to be a wave 3 (pink) of larger wave 3(s).
2. Within the wave 3 (pink), there is an internal 5 wave pattern (yellow).
3. This wave 4 (yellow) remains valid as long as price action respects the 38.2% and 50% Fibonacci retracement levels.
4. The maximum retracement should be the support zone (blue box).
5. A break below the support zone indicates a potentially different Elliott Wave pattern.
6. The main bullish targets are 147.50 and 150.

BTC/USD Bullish Retracement Faces Hefty Resistance Zones

Bitcoin (BTC/USD) made a strong bullish bounce at the previous bottom:

1. The BTC/USD bullish rally at the previous bottom is in our analysis a wave B (orange) of a larger ABC (orange) in wave 4 (yellow).
2. The wave 4 (yellow) of a larger wave 5 (pink) of wave C (gray) remains valid as long as price action respects the 38.2% and 50% Fibonacci resistance levels.
3. A bearish continuation lower should aim at targets around $17.5k, $15k and perhaps as low as $10k.
4. A break above the 50% Fibonacci level indicates that the wave B (orange) could have been wave 5 instead.
5. This is certainly the case if price action breaks above 78.6% Fibonacci level, which means the end of the downtrend and wave C (gray).

Good trading,

Chris Svorcik

The analysis has been done with the indicators and template from the SWAT method (simple wave analysis and trading). For more daily technical and wave analysis and updates, sign-up to our newsletter