GBP/USD – 1.3472
Original strategy :
Sell at 1.3620, Target:1.3420, Stop: 1.3680
Position: –
Target: –
Stop: –
New strategy :
Sell at 1.3535, Target:1.3335, Stop: 1.3595
Position: –
Target: –
Stop:-
As cable met renewed selling interest at 1.3571 yesterday and slipped again, retaining our view that further consolidation below last week’s high at 1.3658 would be seen and mild downside bias remains for the fall from 1.3658 to bring retracement of recent rally to 1.3380-85, then 1.3350 but reckon 1.3300-10 would hold from here.
In view of this, we are looking to turn short on recovery as 1.3540-50 should limit upside. Above said resistance at 1.3571 would risk test of 1.3600 but break of latter level is needed to signal pullback from 13658 (last week’s post-Fed high) has ended, bring retest of this level later. break there would signal recent upmove has resumed for headway to 1.3700-10 first. 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 is unfolding and may extend further gain to 1.3650, then 1.3700, however, overbought condition should limit upside to 1.3770-75 and reckon 1.3800-10 would hold from here, bring retreat later.
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.
