Good morning traders, hope everyone had a great weekend. Let’s get going.
Cable came sharply down from 1.3611 last week which looks like an impulse, so more weakness is expected since we know that any contra-trend moves should be made by minimum three waves. With that in mind, we think that the recent recovery up to 1.3585 level is probably wave b and that a new leg down will show up as wave c, final part of wave 4 that may seek support around 1.3470.
Canadian dollar has been one of the strongest on Friday after good employment figures in Canada overshadowing weak US data. We have seen an extension lower after an earlier break out of a fourth wave triangle, so we think the pair is now in fifth wave which should also contain five subwaves lower. There is room for 1.2300 where the pair may finally look for some support this week.
EURUSD is coming down from last week’s fresh highs of 1.2085 where the pair has completed wave three so the current pullback can be a higher degree wave four. There is a chance for a bounce from 1.1960, but would have to see 1.2030/40 again to make sure that bulls are back.