GBP/USD: wave analysis

The pair can fall.

On the 4-hour chart, the downward correction of the higher level develops as a wave (2). Now the wave C of (2) is forming, within which the local correction iv of C has ended, and the development of the fifth wave of the lower level v of C has begun. If the assumption is correct, the pair will fall to the levels of 1.2660–1.2580. In this scenario, critical stop loss level is 1.3043.

Main scenario

Short positions will become relevant during the correction, below the level of 1.3043 with the targets at 1.2660–1.2580. Implementation period: 5–7 days.

Alternative scenario

The breakout and the consolidation of the price above the level of 1.3043 will let the pair grow to the levels of 1.3213–1.3364.

Trade

Scenario

Timeframe Weekly
Recommendation SELL
Entry Point 1.2843
Take Profit 1.2660, 1.2580
Stop Loss 1.3025
Key Levels 1.2580, 1.2660, 1.3043, 1.3213, 1.3364

Alternative scenario

Recommendation BUY STOP
Entry Point 1.3050
Take Profit 1.3213, 1.3364
Stop Loss 1.2990
Key Levels 1.2580, 1.2660, 1.3043, 1.3213, 1.3364