GBPUSD Elliot Waves Analysis For 10 May 2016 | 10 May 2016

Wave Analysis:

GBP/USD is currently trading with a bearish bias. Yesterday, the pair traded short but could not close below 1.4406. Since the intraday stochastic is trading below its neutrality level of 50 and is headed towards 25. We expect the cable to continue to the lower side but should not go below 1.4106. However, as long as the price keeps being rejected at 1.44061 the price may rally to the upper side but should not go above 1.46637. This pair should be traded alongside AUD/JPY, GBP/CHF, EUR/USD, and NZD/USD. These pairs have a strong positive correlation of up to +0.98 and will likely move in a similar direction during this intraday. Only buy or sell the cable if the other pairs are giving the same signal.

Trade Recommendations:

If you are not short already, sit on the sidelines and wait for a clear breakout below 1.44061 to go short with your target at 1.4106. However, as long as the 1.44061 protects the lower side, expect a possible rebound from this to the upper side.