Elliott Wave Daily

Trade Idea: EUR/GBP - Sell at 0.8425


EUR/GBP - 0.8355

Recent wave: Major double three (A)-(B)-(C)-(X)-(A)-(B)-(C) is unfolding and 2nd (A) has possibly ended at 0.6936.

Trend: Near term down

Original strategy  :

Sell at 0.8485, Target: 0.8355, Stop: 0.8535

Position : -

Target :  -

Stop : -

New strategy  :

Sell at 0.8425, Target: 0.8315, Stop: 0.8465

Position : -

Target :  -

Stop : -

The single currency has remained under pressure after yesterday’s selloff, adding credence to our bearish view that recent decline from 0.8788 is still in progress and downside bias remains for further weakness to 0.8300, then towards 0.8275-80, however, near term oversold condition should prevent sharp fall below 0.8250, risk from there has increased for a rebound to take place later.

In view of this, would not chase this fall here and would be prudent to sell euro on recovery as 0.8425-30 should limit upside. Above previous support at 0.8458 would defer and risk rebound to 0.8485-90 but break of indicated resistance at 0.8512 is needed to signal low is formed, bring a stronger rebound to 0.8545-50 but resistance at 0.8580 should remain intact.

Our preferred count is that, after forming a major top at 0.9805 (wave V), (A)-(B)-(C) correction is unfolding with (A) leg ended at 0.8400 (A: 0.8637, B: 0.9491 and 5-waver C ended at 0.8400. Wave (B) has ended at 0.9413 and impulsive wave (C) has either ended at 0.8067 or may extend one more fall to 0.8000 before prospect of another rally. Current breach of indicated resistance at 0.9043 confirms our view that the (C) leg has ended and bring stronger rebound towards 0.9150/54, then towards 0.9240/50.

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Author: Action Forex
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