GBP/USD – 1.3220
Original strategy :
Sold at 1.3175, stopped at 1.3235
Position: – Short at 1.3175
Target: –
Stop: – 1.3235
New strategy :
Stand aside
Position: –
Target: –
Stop:-
Although sterling staged a stronger-than-expected rebound to 1.3279, as cable met resistance there and has retreated again, suggesting further consolidation within recent established range would take place and weakness to 1.3170-75 cannot be ruled out, however, as outlook remains consolidative, reckon downside would be limited to support at 1.3110 and price should stay above last week’s low at 1.3088, bring another rebound later.
As near term outlook is mixed, would be prudent to stand aside for now. Above 1.3240-50 would bring test of said resistance at 1.3279, however, still reckon upside would be limited to 1.3338 resistance and bring further choppy trading. Our preferred count is that (pls see the attached chart) the wave IV is unfolding as a complex double three (ABC-X-ABC) correction with 2nd wave B ended at 1.2774, hence 2nd wave C could have ended at 1.3658.
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.
