Trade Idea: EUR/GBP - Buy at 0.8580

Recent wave: v of wave 3 has possibly ended at 0.8067 but wave 4 should hold below 0.9050

Trend: Up

 

Original strategy       :
Buy at 0.8580, Target: 0.8700, Stop: 0.8535


New strategy  :
Buy at 0.8580, Target: 0.8700, Stop: 0.8535


Despite yesterday's marginal rise to 0.8712, the subsequent sharp retreat suggests a temporary top is formed and consolidation with mild downside bias is seen for retracement of recent upmove, however, still reckon support at 0.8575 would limit downside and bring another upmove later. We are keeping our view that wave iv has ended earlier at 0.8398 and bullishness remains, above 0.8650 would suggest low is possibly formed but break of said resistance at 0.8712 is needed to extend further gain to 0.8735-40 and possibly towards 0.8775-80 but price shuld falter well below recent high of 0.8815, risk from there is seen for a retreat later.

In view of this, we are looking to buy euro again further corrective fall. Only a firm breach below 0.8575 would defer and risk deeper correction of recent rise to 0.8545-50, however, downside would be limited to 0.8515-20 and price should stay well above 0.8500, bring another rally later to aforesaid upside targets.

Our preferred count is that, after forming a major top at 0.9805 (wave V), (A)-(B)-(C) correction is unfolding with (A) leg ended at 0.8400 (A: 0.8637, B: 0.9491 and 5-waver C ended at 0.8400. Wave (B) has ended at 0.9413 and impulsive wave (C) has either ended at 0.8067 or may extend one more fall to 0.8000 before prospect of another rally. Current breach of indicated resistance at 0.9043 confirms our view that the (C) leg has ended and bring stronger rebound towards 0.9150/54, then towards 0.9240/50.

IMOH, Clement I.
+234 802 905 9344
+234 703 569 1707