Medium term
/
Sell
Trade view / 28 July 2017 at 7:25 GMT

Ending wedge highlights limited upside in GBPUSD

Analyst / PIA First
United Kingdom
Instrument: GBPUSD
Price target: 1.2590
Market price: 1.3080
Background

Is this the turn in the USD? Formations would suggest this could well be the case. 

USD Index

Daily – Moving lower in the fifth wave (Elliott wave formation). Our prime support is seen at 92.50-91.73. 
USD Index D
Source: Saxo Bank

Intraday (one-hour) – In a bearish channel formation. It may also be forming a bullish reverse head and shoulders.
USD Index 1
Source: Saxo Bank

Summary – There are two options:

1. Buy USD weakness close to 93.46, looking for the right shoulder to form. This offers far better risk/reward.

2. Buy a break of yesterday’s high confirming the breakout. 


GBPUSD monthly – Seen a move to the upside from the Fibonacci confluence are (at 1.1593-1.1392).
GBPUSD M
Source: Saxo Bank

GBPUSD weekly – We look for a fifth wave Elliott wave pattern to have completed at 1.1498. The move higher has been mixed and volatile, which is common in corrective formations. 
GBPUSD w

Source: Saxo Bank

GBPUSD daily – Broke out of a triangle formation to the upside. The full measured move target for the breakout is 1.3252. It is currently trading within a congestion zone from July-September 2016. 
GBPUSD D
Source: Saxo Bank

GBPUSD intraday (four-hour) – Building an ending wedge formation. On a break of 1.2990, this formation has a measured move target of 1.2590. Our resistance is seen at 1.3120 today. With a stop placed above the wedge resistance (at 1.3185), this makes for a solid risk/reward medium-term set-up (approximately 6/1 risk/reward).
GBPUSD 4
Source: Saxo Bank 

Management and risk description

The risks to this call are further USD losses and GBPUSD moving to 1.3252.

Parameters

Entry: Selling GBPUSD at 1.3120. 

Stop: Initially 1.3200. A break of 1.2990 and we lower stop to entry. 

Target: 1.2590

Time horizon: medium term


— Edited by Clemens Bomsdorf

Non-independent investment research disclaimer applies. Read more
A compiled overview of Trade Views provided on TradingFloor.com is found here
2y
David12 David12
Goog morning Ian, Nomura says BoE is going to raise interest rates on Thurs.meeying ; do you have any news to confirm it ? if there is such risk then what would be the impact on this call ?
2y
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
Morning David .. does not look like the rest of the market thinks that or I think we would be a lot higher. Would hope to have a stop into to entry by that time.
2y
chaitanya chaitanya
they will not do it before Fed September meeting , probably BOE will do in November
2y
alki alki
Hello Ian, how do you define „medium term” here?
2y
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
Hi Alki.... I would say 1-2 months
2y
Morris Morris
RSI on the 4h chart dvgce is an early sign! The 50 level on RSI still acts as support. One of the trend change confirmations will be when the 50 level becomes resistance! There just may be a little more upside!
2y
Morris Morris
That is in the short term i.e. a week or two. Ian I fully concur to your call. My indicator Ian pls?
2y
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
I think it could take a month or two to complete
2y
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
2017-07-28 16:00:10

The move to 1.3120 triggered our short trade
2y
lee88 lee88
And stop also triggered....sad

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