Although trends are positive, major overhead resistance and a bearish Elliott count threaten the GBP rally. The latest uptrend is still occurring below major resistance between 1.5750/5830; this polarity zone is host to key highs/lows dating back to November of last year as well as the 61.8% retrace of the 2013 sell-off.
S/t, the bull flag we outlined last week did resolve higher and the new rally is nearing today’s resistance at 1.5627. The upchannel is still intact but the Elliott count indicates that an a-b-c rally completed at 1.5718 and Sterling is embarking on a new 5 wave decline. The recent trendline break and bullish trends will be threatened if prices suffer a break of critical channel support at 1.5515.
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