British pound looks for resistance: Elliott Wave

GBP/USD Elliott Wave 4h

The British pound is at the highs against the U.S. dollar (FOREX:GBPUSD), now above the wave the trendline connected from 2009 highs but still below 1.6744, which is a triangle invalidation level from a weekly chart. As such, we are still tracking the final stages of a red wave E) that could be looking for a top formation in 1.6500-1.6650 region. However, before we look for an end to the current rally, we need five waves up in black wave C, which is still not the case so be aware of more upside in this week. On the contrary, move back beneath 1.6240 would suggest that highs are already in.

GBP/USD Daily  Elliott Wave Count #1

GBP/USD broke to a new high as expected after we identified end of a corrective retracement at 1.5850. As such, we are now tracking a new impulse leg up, which can be wave C, final part of a double zigzag in wave E). If this is correct count, then rally from July low is near completion. Ideally we will see a reversal down from around 1.64-1.66 region.

GBP/USD Daily Elliott Wave Count#2

We are also tracking a different count that shows a five-wave rally from July low, but even this count is calling for a turning point as we see pair in fifth wave up.

About the Author

Gregor Horvat, based in Slovenia, has been in the forex markets since 2003. He is a technical analyst and individual trader who has worked for Capital Forex Group and TheLFB.com. He also is founder of forex services on www.ew-forecast.com. EW-Forecast.com provides technical analysis of the financial markets, highlighting behavioral patterns based on the Elliott Wave Principle (EWP). Website: http://www.ew-forecast.com/

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