Analysis of wave counting:
Yesterday's statement by Fed Chairman Janet Yellen that "tightening monetary policy will not hurt the labor market, but only stabilizes it," provoked a surge in volatility in the foreign exchange market, although it did not allow the EUR/USD pair to determine the direction of the movement. It can be assumed that, despite the uncertainty, the currency pair remained in the stage of formation of the first generating waves in the composition of the future wave c, in a, in (C). If this is the case, the currency pair retains the potential for further development of the downward movement, although over a more complex inclined path.
Targets for a downward wave option:
1.1736 - 38.2% by Fibonacci
1.1666 - 23.6% by Fibonacci
Targets for an upward wave option:
1.1918 - 76.4% by Fibonacci
1.1946 - 76.4% by Fibonacci
General conclusions and trading recommendations:
The construction of the downward trend section continues. The assumed wave b, in a, in (C) has completed its construction. If this assumption is correct, then the decline in quotations will continue with the targets located near the estimated marks of 1.1736 and 1.1666, which corresponds to 38.2% and 23.6% Fibonacci within the assumed wave a in c, in a, in (C).