Bearish engulfing candle but still above 1.2467 | 15 February 2017

Instead of going long as previously forecasted, the pair traded massively short and even engulfed the previous day's candle. Although we exepct further momentum to the lowerside, we'll only be intrested in going short upon a clear break below 1.2467 and most importantly a break below 1.2414. If this is the case, then we expect a bearish impulsive wave count towards 1.222 and possibly lower to 1.21. Expect a similar wave count in GBPNZD, GBPAUD, GBPJPY and GBPHKD. These pairs have a strong positive correlation of up to +71% and will have a similar price action during this intraday. Only buy or sell the cable if the other positively correlated pairs are giving the same signal.

Trade Recommendations:

Expect a break below 1.2414 to go short with an ideal target at 1.222. As long as the pair remains above 1.2414, remain flat but expect a momentum to the lowerside.