The article covers the following subjects:
Major Takeaways
- Main scenario: Consider long positions from corrections above the level of 1.3165 with a target of 1.3870–1.4300. A buy signal: the price holds above 1.3165. Stop Loss: below 1.3125, Take Profit: 1.3870–1.4300.
- Alternative scenario: Breakout and consolidation below 1.3165 will allow the pair to continue declining to the levels of 1.2936–1.2736. A sell signal: the 1.3165 level is broken to the downside. Stop Loss: above 1.3205, Take Profit: 1.2936–1.2736.
Main Scenario
Consider long positions above the level of 1.3165 with a target of 1.3870–1.4300 once the correction ends.
Alternative Scenario
Breakout and consolidation below 1.3165 will allow the pair to continue declining to the levels of 1.2936–1.2736.
Analysis
On the weekly timeframe, an ascending wave of larger degree (A) of B is developing. Within it, wave 1 of (A) has formed, and a downward correction has been completed as wave 2 of (A). The third wave 3 of (A) appears to continue forming on the daily chart, with wave iii of 3 developing as its part. On the H4 timeframe, the third wave of smaller degree (iii) of iii has presumably started to form, within which wave i of (iii) has formed and a local correction ii of (iii) is developing. If the presumption is correct, GBP/USD will continue to rise to the levels of 1.3870–1.4300 after the correction ends. The level of 1.3165 is critical in this scenario as a breakout below it will enable the pair to continue declining to the levels of 1.2936–1.2736.
This forecast is based on the Elliott Wave Theory. When developing trading strategies, it is essential to consider fundamental factors, as the market situation can change at any time.
Price chart of GBPUSD in real time mode
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