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The price growth of the EUR/USD currency pair, which we had observed on Friday and Monday, started to assume more completed shape. As a result, there is a picture at the graph, allowing to suppose approaching beginning of a new cycle of the US dollar strengthening. It means that the ending of the horizontal widening wedge formation is possible that can let the price to start a new decline versus the European currency. In such case, December low of 1.4220, likely, will be jumped over quite fast. On the other hand, if bulls determine the market conditions on the euro, probable wedge structure consisting of abcde waves can turn out to be the first five waves of the future upward trend in the direction of November highs. However, even in this case, the price will have to correct first. Besides, as we mentioned yesterday concerning the coming correction (or a renewal of the downward trend), possibly, signals about the stochastics position in overbought zone.
Best regards,
analyst A. Dneprovskiy