GBP/USD – 1.2755
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 down
Original strategy :
Sell at 1.2850, Target: 1.2650, Stop: 1.2910
Position: –
Target: –
Stop: –
New strategy :
Sell at 1.2750, Target: 1.2650, Stop: 1.2810
Position: –
Target: –
Stop:-
Sterling ran into resistance at 1.2818 and has retreated sharply on dollar’s broad-based strength, suggesting the rebound from 1.2635 has ended there, hence consolidation with downside bias is seen for weakness to 1.2670-75, however, break of said support at 1.2635 is needed to confirm recent decline from 1.3048 top has resumed for retracement of recent upmove to 1.2600 but downside should be limited to 1.2550 and reckon previous support at 1.2515 would hold from here.
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, expect recovery to be limited to 1.2750-55 and 1.2790-00 should hold, bring another decline. Above said resistance at 1.2818 would defer and risk a stronger rebound to 1.2860-70 would but price should falter below 1.2900, bring another selloff later.
