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Bullish reversal

22 November 2016, GBP/USD

Bullish reversal

Wave Analysis:

As expected, the cable rebounded perfectly from the lower trend line forming bottom of the rising channel, headed long, and is still pretty much bullish on the daily chart. As long as this pair remains with this channel, we'll only be interested in trading reversals, any clear breakout out of this channel will call for a breakout strategy depending on the direction of the breakout. In the meantime, selling this pair is a bit risky, instead, we choose to remain long and expect a possible bullish price movements towards 1.2743. We'll either go short upon a clear rebound from 1.2743 or upon a clear breakout below the lower trend line. Expect a similar wave count in GBP/HKD and EUR/USD. These pairs, especially the first pair, have a very strong positive correlation to the cable and will have a similar price action during this intraday.

Trade Recommendations:

Remain long or wait and buy above 1.2743. Sell positions are only recommended upon a clear rebound from 1.2743 or on a breakout below the lower trend line with an ideal target at 1.2029

Graham Osano
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