EUR / USD
On Friday, May 17, trading ended for EUR / USD with a decline of 20 bp, which is still fully consistent with the current wave counting, which suggests the construction of a downward wave 3, 3, 3 with targets under 11 figure. The report on inflation in the European Union on Friday was ignored by the Forex market. However, it should be noted that the real value coincided with the forecast. Often in such cases, there is no reaction to the news. While Trump continues to fight with China in a commercial direction, and escalate the military conflict with Iran, the US dollar continues to rise against the euro. News background cannot be called now in favor of the dollar, however, it does not say anything if it's in favor of the euro. I believe that the current wave counting will be maintained in the coming days; therefore, we can expect a decline to 1,1100 and 1,1050.
Sales targets:
1.1097 - 161.8% Fibonacci
1.1045 - 200.0% Fibonacci
Purchase goals:
1.1324 - 0.0% Fibonacci
General conclusions and trading recommendations:
The euro / dollar is still in the process of building a downward trend. Now, I recommend to remain the bears on the instrument with targets of 1.1097 and 1.1045, which corresponds to 161.8% and 200.0% in Fibonacci and a restrictive order above the level of 50.0% in Fibonacci.
GBP / USD
On May 17, the GBP / USD pair lost another 80 basis points and, thus, continues to build the estimated wave c, as part of the new downward three-wave structure. The current wave is very simple in its internal structure. The US dollar in the recent days has an unconditional advantage over the pound. However, this will not always continue. The news background for the pound sterling, of course, remains negative. The Forex market no longer believes in the new announcements of Theresa May regarding the changes made to the Brexit document and does not regard this news as potentially positive for the pound. The leader of the opposition party Jeremy Corbin, who openly stated that it was unlikely that the last version of the document, for which the parliament voted three times, did not believe in this. Significant changes were made, thus he and his party are against this Brexit agreement. Considering that it was with the opposition whereas Theresa May wanted to come to an agreement in order to nevertheless carry out her agreement through parliament. Now, the words of Corbin look like yet another failure for Theresa May.
Sales targets:
1.2675 - 161.8% Fibonacci
1.2554 - 200.0% Fibonacci
Purchase goals:
1.3175 - 0.0% Fibonacci
General conclusions and trading recommendations:
The wave pattern of the pound / dollar instrument implies a continuation of the instrument decline within the wave c. Thus, now, I recommend sales with targets located near the estimated marks of 1.2675 and 1.2554, which corresponds to 161.8% and 200.0% in Fibonacci. An unsuccessful attempt to break through the 161.8% mark may lead to a departure of quotes from the lows reached.
The material has been provided by InstaForex Company - www.instaforex.com