For this pair I tried to provide everything that I currently see that could potentially occur in this pair. There are many components to my analysis, so I will break it down into several parts; just to make it easier for everyone. Let's begin:
BULLISH BAT PATTERN
First of all, let's start by talking about the that is starting to appear on this pair. This is a pattern that will be completing very close to April/13/2015 lows. This gives us a really nice risk to reward ratio, with stops @ 1.4534 and two targets @ 1.5182 & 1.5467, respectively. But before we get to this pattern, we also have another valid ABCD move, so let's talk about that next.
HARMONIC ABCD MOVE
As mentioned earlier, we have to face the ABCD move first before getting the completion. As pointed in the chart above, the completion point (127.2% Fib extension) of the ABCD move is a key level to consider. The reason being that, this level (1.4984) has been respected very well by the market and anytime there was a break in this level, we saw large candle size forming. This shows how strong this level is and the amount of or power that was needed to break and close below or above this level, respectively. Stops and targets for this pattern has been labelled on the chart above.
Lastly, looking at the raw price action, we see that FX:GBPUSD has been in a strong downtrend both on the daily and weekly time frames. Market was in a corrective structure for quiet some time but we recently got a break in this corrective structure, which is a good sign of potential trend continuation of this market in the direction of the major trend. We also recently got a valid retest of the rising and saw a reaction of more than 300 pips from it. I have also labelled a potential reversal zone on the chart above, so that IF the market is able to come into that zone THAN I will look to short this pair. We are currently getting an but since we are aware of the continuation of major downtrend, the is likely to be short lived.
NOTE #1:If we see a break and close above the 1.56580 level, than the stance on this pair will be invalidated.
NOTE #2: I also posted a weekly time analysis on this pair through time cycle analysis. So make sure to check that out because in that post I also point why FX:GBPUSD is likely to go lower in the coming weeks. I have added a link to that chart under the related ideas section below.
Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Thank you everyone for all the SUPPORT that you have given me so far, I truly appreciate it. Good luck everyone :)