EURUSD did exactly what was expected – it created the right shoulder of the iH&S pattern, broke the neckline, and went higher. It all started with the false breakout from the descending triangle (yellow). Sentiment is back in positive territory and will remain as such, as long as we hold above the orange support.
The setup on EURUSD is nice, but the two main stars on Thursday are the indices and bitcoin! First, we will start with the indices, SP500 to be precise. The price broke the combination of a dynamic and horizontal support, thus activating a super important sell signal. With this momentum, we should see the SP500 hit the lows from February and April relatively soon.
Bitcoin is also bearish, and we’ve been expecting this drop for a while! The price bounced from the upper line of the descending triangle pattern and broke the lower line of the flag. The target is obvious – 5900 USD. What will happen next depends on the price action at this level. Once more we’ll need to be a bit patient.