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GBPUSD Elliot Waves Analysis For 16 May 2016

16 May 2016, GBP/USD

GBPUSD Elliot Waves Analysis For 16 May 2016

Wave Analysis

GBP/USD is currently trading with a bearish bias. During the previous trading day on Friday 13th May 2016, cable traded short as previously forecasted and is still pretty much bearish. We expect the current upward rally to be a mere upward retracement and should not close above 1.4480. A clear breakout above 1.4480 will lead to an acceleration to the upper side. However, as long as the pair trades within the descending channel, we expect a momentum to the lower side. This pair should be traded alongside AUD/USD, NZD/USD and EUR/USD. These pairs have a strong positive correlation of up to +0.89 and will likely have a similar price action during this intraday.
Trade Recommendations:
During this intraday, expect a downward acceleration towards 1.4304. A clear break below this level will push the price further to the lower side. Thus, if you are not short already, wait for the current upward retracement to end at 1.4480, then sell the pair with your ultimate target at 1.4106. Buy positions are only recommended above 1.4480.
Graham Osano
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