Today's support and resistance levels:
S1: 123.80 R1: 124.64
S2: 123.43 R2: 125.25
S3: 122.62 R3: 125.78
Technical overview:
We are still looking for a minor decline towards 123.80 in wave ii of 5. At 123.80, wave ii of 5 will have reached the bottom of wave four of one lessor degree, which is a very common target for the second wave. That said, we could see wave ii move lower towards 122.62 and even 121.82, where wave ii would have corrected 61.8% of wave i, but the market has been really impatient with this cross, therefore we would not expect such a deep correction. Once this wave ii correction is over, we should expect a powerful rally in wave iii of 5 towards at least 130.72, but a more likely target will be 134.58, where wave iii will be 1.618 times the length of wave i.
Trading recommendation:
We are looking to buy EUR and will buy at 123.90 or upon a break above 124.62 with a stop at 118.70 expecting an opportunity to move our stop closer to the entry point quickly.