We are locked in an extremely tight rang presently, which should resolve in a powerful move once we sees a breakout. I still favor, that a small ending diagonal is developing and that would call for a break towards the upside. A break above the minor resistance at 120.18 will be the first indication, that a bottom is in place, while a break above 120.86 will confirm the bottom for a rally higher to at least 124.50. If wave iii of 5 is developing, then resistance at 124.50 should not prove to be any obstacle at all, but if we see 124.50 holding, then we will shift my preferred count towards the triangle scenario. However, as long as resistance at 120.18 protects the upside the risk is still towards the downside, but if my bullish count is correct, then at no point can a break below 118.73 be allowed. If support at 118.73 breaks, the wave 4 is still developing and a continuation down to 117.05 will likely follow.
I'm are looking for a break above 1.5319 as the first indication, that a bottom is in place with the test of 1.5180. That said, we need a break above 1.5376 to confirm the bottom and that a new major rally is developing. A rally that will ultimately take us back above 1.6359 and possibly much higher. However, as long as resistance at 1.5319 and more importantly at 1.5375 protects the upside we must accept the possibility of a new attack towards the downside, but the potential room towards the downside should be very limited.
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