Chart of the day

EURUSD is breaking below the significant downside resistance of 1.05200. A confirmed break will validate the long-term fifth wave downside extension which could lead the pair much lower.

This is still viewed as the long-term five-wave downside and a fifth wave is being developed for a test of 1 in the short-term. It seems that this is the third wave of the short-term five waves down which is the longest one and the most profitable for traders.

Short trades you can open here with a stop loss above 1.0600. We favor the short trade entries at this stage as we see an ongoing price action to continue lower in the fifth wave to finish the large cycle and with an immediate downside extension without a pullback at the moment.