EUR/GBP – 0.8725
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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 :
Buy at 0.8575, Target: 0.8675, Stop: 0.8535
Position : –
Target :Â –
Stop : –
New strategy :
Buy at 0.8620, Target: 0.8750, Stop: 0.8580
Position : –
Target :Â –
Stop : –
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As the single currency has surged again after brief pullback, adding credence to our bullish view that the rise from 0.8312 low is still in progress and above resistance at 0.8735 would encourage for further gain to 0.8765-70 but near term overbought condition should limit upside today and price should falter below resistance at 0.8788, risk from there is seen for a retreat later.
In view of this, would not chase this rise here and would be prudent to buy euro again on pullback as 0.8615-20 should limit downside. A firm break below support at 0.8603 would abort and suggest a temporary top is formed instead, risk correction to 0.8575-80 and possibly towards 0.8550 but support at 0.8524 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.
