EUR/GBP – 0.8913
Original strategy :
Bought at 0.8985, stopped at 0.8945
Position : – Long at 0.8985
Target : –
Stop : – 0.8945
New strategy :
Stand aside
Position : –
Target : –
Stop : –
Despite yesterday’s brief rise to 0.9033, the subsequent much stronger-than-expected retreat signals top has been formed there an consolidation with mild downside bias is seen, below 0.8875-80 would bring test of support at 0.8850 but break there is needed to add credence to this view and suggest the rebound from 0.8746 low has ended, bring further fall to 0.8800-10.
In view of this, would not chase this fall here and would be prudent to stand aside in the meantime. Above 0.8930-35 would bring recovery to 0.8955-60 but upside should be limited to 0.8985-90, price should falter well below said resistance at 0.9033, bring another selloff next week.
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.
