EUR/GBP – 0.9035
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 0.9080, Target: 0.8980, Stop: 0.9100
Position : – Short at 0.9080
Target : – 0.8980
Stop : – 0.9100
New strategy :
Hold short entered at 0.9080, Target: 0.8980, Stop: 0.9080
Position : – Short at 0.9080
Target : – 0.8980
Stop : – 0.9080
As the single currency has retreated after rising to 0.9088 yesterday, retaining our view that consolidation below this level would be seen and mild downside bias remains for test of indicated support at 0.8995, break there would suggest top is possibly formed there, then weakness to 0.8965-70 would follow but below 0.8945-50 is needed to add credence to this view, bring retracement of recent upmove towards support at 0.8922.
In view of this, we are holding on to our short position entered at 0.9080. Above said resistance at 0.9088 would risk gain to 0.9145-50, however, still reckon sharp move beyond there should not be repeated and upside should be limited to 0.9175-80, price should falter below 0.9100, bring correction later.
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.
