GBP/USD – 1.2886
Recent wave: Wave V of larger degree wave (III) has ended at 1.1986 and major correction has commenced from there for gain to 1.3000 and 1.3140-50
Trend: Near term up
Original strategy :
Sold at 1.2920, Target: 1.2770, Stop: 1.2980
Position: – Short at 1.2920
Target:Â – 1.2770
Stop: – 1.2980
New strategy :
Hold short entered at 1.2920, Target: 1.2770, Stop: 1.2920
Position: – Short at 1.2920
Target:Â – 1.2770
Stop:- 1.2920
Although the British pound staged a strong rebound after marginal fall to 1.2769 yesterday, as sterling met resistance at 1.2921 and has retreated, retaining our bearishness and as long as this level holds, mild downside bias remains, below 1.2840 would signal the rebound from 1.2769 has ended, bring weakness to 1.2800, then retest of said support, break there would extend recent decline from 1.3048 to support at 1.2757 which is likely to hold on first testing.
Our preferred count on the daily chart is that cable’s rebound from 1.3500 (wave (A) trough) is unfolding as a wave (B) with A ended at 1.7043, followed by triangle wave B and wave C as well as wave (B) has ended at 1.7192, the subsequent selloff is the larger degree wave (C) which is still unfolding with minor wave (III) of larger degree wave 3 ended at 1.1986, hence wave (IV) correction is in progress which could either be a triangle wave (IV) of a complex formation but upside should be limited to 1.3500 and price should falter well below 1.4000, bring another decline in wave (V) of 3 for weakness to 1.1500, then 1.1200.
On the upside, above 1.2921-26 (said resistance and previous support) would defer and suggest low has been formed instead, risk a stronger rebound to 1.2965-70 and possibly towards 1.3000 but only break of resistance at 1.3015 would signal the retreat from 1.3048 has ended.
