The article covers the following subjects:
Major Takeaways
- Main scenario: Once the correction ends, consider long positions above the level of 1.3375 with a target of 1.4000 – 1.4220. A buy signal: the price holds above 1.3375. Stop Loss: below 1.3270, Take Profit: 1.4000 – 1.4220.
- Alternative scenario: Breakout and consolidation below the level of 1.3375 will allow the pair to continue declining to the levels of 1.3118 – 1.2926. A sell signal: the level of 1.3375 is broken to the downside. Stop Loss: above 1.3470, Take Profit: 1.3118 – 1.2926.
Main Scenario
Consider long positions above the level of 1.3375 with a target of 1.4000 – 1.4220 once a correction is formed.
Alternative Scenario
Breakout and consolidation below the level of 1.3375 will allow the pair to continue declining to the levels of 1.3118 – 1.2926.
Analysis
On the daily time frame, the ascending first wave of larger degree 1 of (A) has formed, followed by a downward correction as the second wave 2 of (A). The third wave 3 of (A) is in progress. The first counter-trend wave of smaller degree i of 3 continues developing on the H4 chart, with wave (iii) of i formed as its part. Apparently, a local correction is developing as wave (iv) of i on the H1 chart, with wave а of (iv) forming within. If the presumption is correct, the GBP/USD pair will continue to rise to 1.4000 – 1.4220 after the correction ends. The level of 1.3375 is critical in this scenario as a breakout will enable the pair to continue declining to the levels of 1.3118 – 1.2926.
This forecast is based on the Elliott Wave Theory. When developing trading strategies, it is essential to consider fundamental factors, as the market situation can change at any time.
Price chart of GBPUSD in real time mode
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