18.06.201910:24 Forex Analysis & Reviews: Wave analysis of EUR/USD and GBP/USD on June 18. Markets are waiting for the speech of Draghi and EU inflation data

EUR/USD

On Monday, June 17, the EUR/USD pair ended with an increase of several base points. Thus, based on the current wave layout, wave 2 can be completed. If this is true, then from the current position, the instrument will resume the increase within wave 3 of the upward trend segment. The main opponents of this scenario are the news background. If it ceases to support the euro, the pair may move to the construction of a side section of the trend or even return to the downward one. That is, it is vital for the euro to receive regular news feed. Today, there will be a speech by Draghi at the ECB forum in the city of Sintra, however, his speech will hardly be devoted to the issues of monetary policy. But a little later, there will be data on inflation in the European Union, and a value below 1.2% y/y can lead to at least a complication of wave 2. And tomorrow, the markets will understand what to expect from the Fed in the near future. The main question: will the Fed go for a rate cut in 2019? It is from the words of Jerome Powell that traders will try to understand the answer to this question.

Purchasing goals:

1,.367 – 76.4% Fibonacci

1.1447 – 100.0% Fibonacci

Sales targets:

1.1106 – 0.0% Fibonacci

General conclusions and trading recommendations:

The euro/dollar pair completed the first wave of the upward trend. I recommend waiting for the completion of wave 2 and start buying the euro currency with targets located near the calculated marks of 1.1367 and 1.1447, which is equal to 76.4% and 100.0% Fibonacci. At the same time, leaving the instrument below the minimum wave C will complicate the current wave marking.

GBP/USD

The GBP/USD pair lost another 55 basis points on the eve and made a successful attempt to break the low of May 31. Thus, the wave pattern has been transformed and now represents a 5-wave formation. If this is true, then from the current position, the instrument will continue to decline within the wave e with targets below the 25 figure. In the case of the pound sterling, the news background can support further sales of the instrument by the Forex market. No positive information is coming from the UK, and if tomorrow Jerome Powell does not disappoint the markets with an immediate reduction in the key rate, the pound is likely to continue to decline. Bank Of England Chairman Mark Carney will speak today, but his speech is far less important than Powell's press conference tomorrow.

Sales targets:

1.2434 – 161.8% Fibonacci

1.2359 – 200.0% Fibonacci

Purchasing goals:

1.2767 – 0.0% Fibonacci

General conclusions and trading recommendations:

The wave pattern of the pound/dollar instrument does not change and assumes a continued decline of the instrument within the fifth wave. Thus, now I recommend selling the pound with targets located near the calculated levels of 1.2434 and 1.2359, which corresponds to 161.8% and 200.0% of Fibonacci. Purchases, in my opinion, are still associated with increased risks.