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25.06.202416:24 Analisis Forex & Kajian: Analysis of EUR/USD pair on June 25th. The market continues to await important news

The wave analysis of the 4-hour chart for the EUR/USD instrument remains unchanged. Currently, we observe the formation of the presumed wave 3 within wave 3 or c of the bearish part of the trend. If this is indeed the case, the decline in quotes will continue for quite some time, as the first wave of this segment completed its formation around the 1.0450 mark. Therefore, the third wave of this trend segment should end lower, even if it does not take on an impulsive form.

The level of 1.0450 is the target only for the third wave. If the current bearish trend segment assumes an impulsive form, then we can expect a total of five waves, and the euro could well decline below the 1.0000 mark. Certainly, it isn't easy to expect such a development now, but over the past years, there have been plenty of surprises in the currency market.

An alternative scenario I see now is the transformation of wave 3 or c into a corrective pattern with five waves labeled as a-b-c-d-e. Even in this case, the low of wave 3 or c should be below the low of wave 1 or a. Therefore, if the formation of wave e in 3 or c has begun now, rather than wave 3 in 3 or c, the decline of the instrument should still continue.

The euro is poised for further decline, but a pause is needed.

The EUR/USD instrument declined by just 15 basis points on Tuesday. It is clearly visible on the charts that since June 14, the instrument has been trading in a local range. Therefore, the market is accumulating positions and preparing for a stronger move. Earlier this week, I mentioned that there is currently no reason to expect such a move. The news background is very sparse, so the market prefers waiting a bit. If the wait is shorter, it may exit the range without significant data or events, but for now, time is still holding.

Tuesday's news is absolutely unremarkable. Certainly, every day, the market receives a certain amount of information from major banks, significant politicians, various analysts, and so on. However, it's unlikely that the market is ready to react to every piece of such news. For example, almost all recent speeches by ECB and Fed officials have been virtually identical to each other. Therefore, I do not expect any significant price changes based on another speech by an FOMC member or an ECB manager. The GDP report in the US this week will likely not be the event that pushes the instrument out of its range. The likelihood of a deviation from the 1.3% figure in the first quarter is quite low.

Overall conclusions.

Based on the analysis of EUR/USD, the construction of a bearish wave set continues. In the near future, I expect the continuation of the downtrend wave 3 or c with a significant decline in the instrument. I continue to consider only sales with targets around the calculated mark of 1.0462. The internal wave structure of wave 3 or c may take a five-wave corrective form, but even in this case, quotes should decline to the 4-5 figure range.

On a larger wave scale, it is evident that the presumed wave 2 or b, which has retraced more than 76.4% according to Fibonacci from the first wave, may have been completed. If this is indeed the case, then the scenario of constructing wave 3 or c and lowering the instrument below the 4-figure level continues to unfold.

Key Principles of My Analysis:

  1. Wave structures should be simple and clear. Complex structures are difficult to play out and often bring about changes.
  2. If there is uncertainty about what is happening in the market, it's better not to enter it.
  3. There is never 100% certainty in the direction of movement. Remember protective Stop Loss orders.
  4. Wave analysis can be combined with other types of analysis and trading strategies.

* Analisis pasaran yang disiarkan di sini adalah bertujuan untuk meningkatkan kesedaran anda, tetapi tidak untuk memberi arahan untuk membuat perdagangan.

Chin Zhao,
Analytical expert of InstaSpot
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