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Downward momentum developing

30 September 2016, GBP/USD

Wave Analysis

The cable is currently trading with a declining upward momentum. Instead of going long as previously forecasted, the cable traded short during the previous trading day and is pretty much bearish on both the daily and monthly charts. If the monthly chart can close the way it is at the moment, then we expect further decline in price but should not go beyond 1.1296. Trade this pair alongside USD/ZAR, and EUR/JPY. These pairs have a strong positive correlation of up to 68% and will have a similar price action during this intraday.

Trade Recommendations:

As long as the lower trend line protects the lower side, expect a possible bullish price rally towards 1.41114, any clear breakout below this trend line will call for short positions with an ideal target at 1.1296.

Graham Osano
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