Elliott Wave Daily

Trade Idea: EUR/GBP - Hold short entered at 0.8845


EUR/GBP - 0.8844

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 up

Original strategy  :

Sold at 0.8845, Target: 0.8745, Stop: 0.8885

Position : - Short at 0.8845

Target :  - 0.8745

Stop : - 0.8885

New strategy  :

Hold short entered at 0.8845, Target: 0.8745, Stop: 0.8885

Position : - Short at 0.8845

Target :  - 0.8745

Stop : - 0.8885

Remark: Due to holidays, next Trade Ideas update will be made on 19 July 2017.

Although the single currency has rebounded after finding support at 0.8756 and initial upside risk remains, as long as indicated resistance at 0.8882 (last week’s high) holds, further consolidation would be seen and prospect of another retreat remains, below said support at 0.8756 would add credence to our view that a temporary top is possibly formed at 0.8882, bring retracement of recent upmove to 0.8730-35, however, still reckon downside would be limited to 0.8719 support.

In view of this, we are holding on to our short position entered at 0.8845. Above 0.8882 would revive bullishness and extend recent upmove from 0.8304 low to 0.8900-10, having said that, as broad outlook remains consolidative, reckon current c leg of larger degree wave b should be limited to 0.8950 and price should falter well below 0.9000 psychological level.

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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