Elliott Wave Daily | Written by Action Forex
EUR/GBP – 0.8386
Recent wave: v of wave 3 has possibly ended at 0.8067 but wave 4 should hold below 0.8600
Trend: Down
Original strategy :
Bought at 0.8390, Target: 0.8510, Stop: 0.8330
New strategy :
Hold long entered at 0.8390, Target: 0.8510, Stop: 0.8330
Failure to extend yesterday's rebound from 0.8363 and the retreat from 0.8416/17 suggest caution on our long position entered at 0.8390 and support at 0.8334 (last week's low) needs to hold to retain bullishness for another rebound, above minor resistance at 0.8480 would suggest the retreat from 0.8527 has ended and bring another bounce to this resistance. Looking ahead, a break of said resistance at 0.8527 would add credence to our view that a 5-waver decline from 0.8941 has ended at 0.8334 and bring retracement of this decline to 0.8565/70 (38.2% Fibonacci retracement of 0.8941 to 0.8334) but resistance at 0.8595/00 would cap upside.
In view of this, we are holding on to our long position entered at 0.8390. Below said support at 0.8334 would signal the aforesaid decline from 0.8941 is still in progress and extend weakness to 0.8300/10 before prospect of another rebound.
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. Above psychological resistance at 0.9000 would signal the (C) leg has ended and bring stronger rebound towards 0.9100.
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