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Wave analysis for EUR/USD on January 7, 2021

Eurozone's consumer price index will be announced today at 10:00 Universal time. This will be followed by two other reports at 13:30 Universal time: US Nonfarm payrolls and unemployment figures.

EUR/USD, H4 timeframe:

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The development of a downward corrective trend, which is acquiring a complex form of a triple combination, can be assumed. At the moment, a downward wave Y is being formed within the framework of the supposed triple zigzag. This takes a simple zigzag form.

It is very possible that most of the wave has already been completed, which takes the form of a simple zigzag [A]-[B]-[C], where the first two parts, impulse [A] and correction [B], have already been done. Meanwhile, the last impulse wave [C] is only half-formed.

After the end of sub-waves (1) and (2), the price began to form a more powerful impulse wave (3). Recently, correction 4 ended in its composition, after which the price made a downturn. It is possible that the initial part of the last fifth sub-wave 5 is being formed, which will take the form of an impulse [1]-[2]-[3]-[4]-[5], as shown in the graph.

The price may decline to the level of 1.1106 in the near future, after which a slight increase is expected in the correctional wave (4).

Currently, one can consider opening sell deals from the current level.

The material has been provided by InstaForex Company - www.instaforex.com

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