Overbought GBPUSD? Three advancing blocks

FX:GBPUSD   British Pound / U.S. Dollar
230 3
Whilst the Moving Averages and current trends direction is bullish , we can ask ourselves if this could be a turning point for GBPUSD . Chances are it wont and new highs are to be made. However the three advancing blocks (3 weak white soldiers of last 3 candlesticks ) combined with the Elliot wave theory (marking the trend as a possible last wave 5) and the overbought RSI (nearing 70) may give a reason to short.
The last daily bar has a small volatility and the signal for shorting is below its lows at around 1.7130.
Such a trade is against the trend (ie against directions probabilities) hence tightening the stoploss upon a movement down is to be considered.
What makes such a trade attractive is the perceived Reward-Risk ratio.
Just an idea.
6/8/14: What is next: the down move clearly showed that GBPUSD was indeed overbought above the 1.70 levels. The upward momentum is still there so I would expect GBPUSD to climb a bit upwards to a retrace of 50% of its last downmove from 1.7180. However new lows may be made which shall alter the 50% retracement point.
24/7/14: The price is now approaching an area of support, being at the same price region of highs of larger wave 3 and the lows of smaller wave 4. A daily close below the wave 4 low gives an added probability on the price eventually reaching the target. The stoploss however would have been triggered if it was based on the intrabar move but not triggered if based on the end of day move. Probably a better point to have placed it is slightly above the 1.72 price in order to avoid the whipsaw price action which made a new high in the form of a false breakout.
7/7/14: The daily candlesticks of Thursday and Friday (hanging man and doji) showed the three advancing blocks have indicated a slowing uptrend. However it is still a possibility to see new highs as GBPUSD hasnt dropped a lot showing buyers were in control. Lets see if sellers shall gain more control this week.
EN English
EN English (UK)
EN English (IN)
DE Deutsch
FR Français
ES Español
IT Italiano
PL Polski
SV Svenska
TR Türkçe
RU Русский
PT Português
ID Bahasa Indonesia
MS Bahasa Melayu
TH ภาษาไทย
VI Tiếng Việt
JA 日本語
KO 한국어
ZH 简体中文
ZH 繁體中文
AR العربية
HE עברית
Home Stock Screener Forex Screener Crypto Screener Economic Calendar How It Works Chart Features House Rules Moderators Website & Broker Solutions Widgets Stock Charting Library Feature Request Blog & News FAQ Help & Wiki Twitter
Profile Profile Settings Account and Billing My Support Tickets Contact Support Ideas Published Followers Following Private Messages Chat Sign Out