20 May 2016, EUR/USD
EUR/USD is currently trading with a slight bullish bias. Yesterday, the pair traded short as previously forecasted but could not reach our target support 1.1160. We expect further movements to the lower side, the current upward rally is a mere retracement and should not go above 1.12177. A clear breakout above this level will lead to an acceleration to the upper side while a clear rebound from this level will lead to a momentum to the lower side. A rebound from 1.12177 is highly likely since we expect to continue with wave (5) to the lower side. This pair should be traded alongside AUD/USD, EUR/HKD and NZD/USD. These pairs have a strong positive correlation of up to +0.92 and will likely have a similar price action during this intraday.
Remain flat for now and wait for a clear rebound from 1.12177 then go short with your target at 1.1160. A clear breakout above 1.12177 will call for long positions with targets at 1.1283 and 1.1396
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