Elliott Wave Daily

Trade Idea: EUR/GBP - Stand aside


EUR/GBP - 0.9092

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, stopped at break-even

Position : - Short at 0.9080

Target :  -

Stop : - 0.9080

New strategy  :

Stand aside

Position : -

Target :  -

Stop : -

The single currency continued finding decent demand just below 0.9010 and has risen again, dampening our near term bearishness for a correction and signaling recent upmove has resumed, hence further gain to 0.9120-25, then 0.9145-50 would be seen, however, weakening of near term upward momentum should prevent sharp move beyond 0.9175-80 and price should falter below 0.9100, bring correction later.

In view of this, would not chase this rise here and would be prudent to stand aside for now. Below 0.9050 would bring another test of 0.9008-10 support but break there is needed to suggest a temporary top is possibly formed, bring retracement of recent rise to 0.8965-70 and later towards 0.8922 support which is likely to hold from here.

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.