Weekly Waves 22 August: EUR/USD, GBP/USD and Bitcoin

Our weekly Elliott Wave analysis reviews the EUR/USD monthly chart, the GBP/USD 4 hour chart, and the Bitcoin crypto currency weekly chart.

EUR/USD Testing Key Support Zone at 0.9750

The EUR/USD is testing again the key parity (1.00) level:

1. The EUR/USD is expected to decline further but a larger support zone and 78.6% Fibonacci level (blue box) could stop the downtrend around 0.9750.
2. A bullish reaction at the support zone could indicate a larger bullish correction within the wave 4 (pink).
3. The bullish rebound could take price back up the 23.6% and 38.2 Fibonacci retracement levels plus resistance trend line.
4. Eventually a bearish continuation is expected towards the 88.6% Fibonacci retracement level and -27.2% Fibonacci target.
5. A bearish breakout below the support 0.9750 indicates an immediate continuation lower.

GBP/USD Testing Critical Bottom and Support

The GBP/USD is testing the previous bottom:

1. The GBP/USD is testing a key support zone (green box).
2. A bullish breakout above the resistance zone (orange) could indicate a rally (blue arrows) towards the previous top (orange box).
3. In that case, price action is probably building an ABC (green) pattern in wave 4 (orange).
4. A bearish breakout (red arrows) below the support (green box) could indicate an immediate downtrend towards 1.16 and 1.15.
5. In that case, price action is probably building a wave 123 (white) impulse.

BTC/USD Wave Patterns Indicate Consolidation

Bitcoin (BTC/USD) is building a bullish retracement but price action is struggling to find any substantial move up:

1. BTC/USD bearish breakout below the previous bottom (red arrows) indicates a downtrend continuation towards targets at $15k and $12.5k.
2. A bullish bounce at or above the previous bottom could indicate a sideways movement.
3. Price action could retrace upwards as high as the 38.2% Fibonacci retracement level but ultimately remain in a downtrend.
4. Eventually one more lower low is possible to complete a wave C (yellow) or finish a wave Y (pink).
5. A break above the 38.2% Fibonacci retracement level indicates a larger ABC (yellow) within wave Y (pink).

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