Pound/Dollar-GBP/USD has retraced from the previously posted 1.3000 Levels and is looking vulnerable against most FX Majors with a new Bearish Cycle winking.
There is still a Bearish Stance present for the Pound/Dollar-GBP/USD as the UK Elections are right around the corner and news-wise there are almost no consistent signs of a Bullish outcome for the Pound/Dollar-GBP/USD.
Fundamentally speaking both Theresa May and Jeremy Corbyn are PRO Hard Brexit and Technically speaking the Dollar Index (DXY) is also preparing for a Bullish Cycle and a very possible bounce at or around the 96.40 Levels.
Traders very much seem like they are still holding Short Positions at the 1.3000 Levels, which also pose as Significant Resistance Levels and Points of Interest (Vibration Levels). There is also a Bearish Divergence present at the mentioned Levels which would lead towards Sellers getting back on board and possibly trash the Pound/Dollar-GBP/USD.
With the Price Action developing in the meanwhile, we decided to update the Charts and the Wave Counts. Since April 28th post on the Bearish Swing that we shared, there has been a decline of 235 pips for the 1st Bearish Leg, leaving us in a Corrective Structure right before the UK Elections.
Pound/Dollar-GBP/USD – UK Elections – Wave Count Update:
After the previously pointed ABCDE Descending Channel in Minute IV (green) Pound/Dollar-GBP/USD moved higher, as expected, towards the end of Minute V (green) and also the end of the Bullish Cycle.
Within Minute V (green) we can see a Running Flat Structure in Minuette (IV) (black) and also the last Bullish Impulse for Minuette (V) (black), hitting the 1.3000 Resistance.
Pound/Dollar-GBP/USD had a change of heart with the Trend switching towards the Bears side on the 18th of May, confirming the start of the Bearish Minuette A (red), which developed as a Zig-Zag within its Minuette Sub-Waves ABC (black).
Minute B (red) is showing a Complex Corrective Structure, with a Contracting Triangle in Minuette (B) (black). Within Minute B (red), Minuette (C) (black) seems to be finalizing its last squeeze towards the up-side. Overall, from other Technical views, we can even believe that Minute B (red) is in fact a Flag Formation and also spot a possible Head & Shoulders Formation, both views pointing towards an up-coming Bearish Impulse, not to mention the confirmed Bearish Divergence.
Previously mentioned SELL Levels seem to remain intact, as per the Price Action recent swings and the Structures Analysis, leaving Traders to think that further up-side for the Pound/Dollar-GBP/USD would be limited.
*Safety Measures: – When in the green, move SL to break-even or in profit – If Conservative, wait for Elections Outcome and then look for a Flag Formation or a Corrective Structure
Many Pips Ahead!
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Bearish Swing occurred as per the UK Elections:
Wave Count updated.
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311 pips profit taken so far
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Congrats to those who followed since the 1st post and even bigger congrats to those who held their short positions!
Original post:
Comments
Ronnee
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Yeh, and thanks to you! for your prior encouraging analysis! I felt, May, would get her arsed kicked!! I have closed at 127600. But will be watching for a second wave downwards to a TP of 123500 there'abouts maybe..will watch results of election etc..a good Brexit result will be differcult now with a, maybe, hung parliament. Lots to come I feel..cheers and good luck ronnee
Lionheart-EWA
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@Ronnee, Glad you are in the green Ron. Many more things to come after this, watching the charts and will update you.
Ronnee
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Hi, thanks for your comprehensive analysis here..I hope you are correct as I'm holding a short position..Ron
Lionheart-EWA
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@Ronnee, Hi Ron, would be a good idea if you move the SL at break-even if you entered at 1.3000
Lionheart-EWA
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@Ronnee, trade held nicely Ron, congrats on your profits.