GBP/USD Elliott Wave
Last week the GBP/USD pair was trading upwards, corrective (c) wave (coloured green) of the bigger (4) wave (coloured red) was developing. During the Fridays Asian and European sessions we could observe strong descending movement from 1.5877 toward the 1.5760 level. Therefore, during the New York session this major pair continued trading in a bearish mood reaching a new weekly low at 1.5680 level. We can consider this move as the end of the impulsive (3) wave (coloured green) of the bigger (5) wave (coloured red). At the moment the GBP/USD pair is trading around 1.5729 level and we are expecting to see the price lower when development of the corrective (4) wave (coloured green) ends. In accordance with our wave rules and taking into account that the wave 5 should retrace 100% of the wave 1, we can define the potential targets with measuring wave 1 with take profit at 1.5554 (100% of wave 1). To reduce the risk, we can use invalidation at 1.5807 level as stop loss.
Support and Resistance
(S3) 1.5443 (S2) 1.5567 (S1) 1.5631 (PP) 1.5755 (R1) 1.5819 (R2) 1.5943 (R3) 1.6007
Trading Forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the downward movement. That is why short positions at level 1.5748 with stop loss 1.5807 and take profit at 1.5554 are recommended.