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Remain long

29 September 2016, GBP/USD

Remain long

Wave Analysis

Perfectly as previously forecasted, the cable rebounded from the lower trend line forming bottom of the wedge and is currently headed to the upper side. Although we expect an acceleration towards 1.41114, we cannot rule out a possibility of a breakout below the lower trend line. The latter is equally likely since the monthly chart is pretty much bearish and if it can close the way it is right now(bearish pin bar), then we expect to continue short during the coming month. Trade this pair alongside EUR/JPY and USD/ZAR. These two pairs have a strong positive correlation and will have a similar price action during this intraday.

Trade Recommendations:

As long as the lower trend line protects the lower side, look for potential long positions with an ideal target at 1.41114. Any clear breakout below the lower trend line will call for short positions with the next target at 1.1285.

Graham Osano
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