I can't ignore what's going on but will try to explain why I have the bias I mentioned before and why I still see the downside to be limited.
Fundamentally we can talk about the Brexit (in the end this most likely only turns out to be a technical leave and nothing really changes between EU and UK) but let's not forget the US situation. If we focus on real fundamentals, where growth comes from in the US (debt and not improved productivity or new jobs among other things). The way we measure data has changed over the years so that's why I mentioned before; news and fundamentals are two total different things. The dollar strength from 2008 will correct and that correction might shock many. Among the four major asset classes the currency market is the hardest to analyze in relation to the other three major asset markets. (just a note for correlation traders).
I therefore simply see no reason to expect a new impulse on the weekly time frame for GBPUSD , because time wise this is almost impossible without a significant correction before. This will simply bring price too low, too fast. When analyzing structure we have to realize all possible patterns and certain patterns are still very valid. One of these patterns is an expanded corrective pattern, like I said before this is the pattern that fools most traders. Both fundamentals as technical's seem to line up for a new impulse but then all of a sudden it reverses. You can go back in history to see this happen over and over again. This is why I don't only look at structure but do trade structure as a trading technique.
When forecasting I personally need more than just an impulse or correction.
That being said I'm looking for a wave 3 of wave C lower on weekly time frame that has a little more room to the downside.
Let's focus on the 4 hour time frame for a possible trade:
Like I said in my previous post I was looking for a more pronounced retrace and didn't consider a sell anymore as of this week. Well price clearly moved lower but it would really surprise me to break lower this week. If it does I expect it only to test previous lows. So ideally we see the start of a correction for the rest of the week. This might turn into a wave 4. Once we are able to determine whether that is correct and in fact is a wave 4 I will be looking for what I expect to be the low for the month of October @1.258ish.
Just to be clear this is an IF=THEN process. Key is that I'm looking for a reversal and consider another leg lower after that. My view has changed as of my first post where I was looking for a buy. That's because price action made me. Bigger picture however nothing has changed. Updates will follow.