EUR/GBP – 0.8893
Original strategy :
Sold at 0.8850, Target: 0.8735, Stop: 0.8890
Position : – Short at 0.8850
Target : – 0.8735
Stop : – 0.8890
New strategy :
Stand aside
Position : –
Target : –
Stop : –
Current much stronger-than-expected rebound has dampened our bearishness and signals the fall from 0.9033 has ended at 0.8733 yesterday, hence upside risk remains for further gain to 0.8925-30, then test of resistance at 0.8957, however, break of 0.8976 resistance is needed to add credence to this view, bring further gain to 0.9000, then retest of 0.9033 later.
In view of this, would not chase this rise here and would be prudent to stand aside in the meantime. On the downside, expect pullback to be limited to 0.8870 and reckon 0.8830-35 would hold, bring another rise later. Below 0.8830-35 would risk weakness to 0.8800 but only break of 0.8765-70 would abort and signal the rebound from 0.8733 has ended instead.
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.
