GBP/USD weekly wave analysis

GBP/USD Elliott Wave
For the past few weeks the GBP/USD pair is trading downwards, in Elliott perspective this move represents impulsive wave (1) (coloured green) of the bigger wave 3 (coloured red). During the Friday’s Asian and European sessions we could observe strong descending movement from 1.5280 towards the 1.5223 level. Therefore, during the New York session this major pair has continued trading in a bearish mood and the price reached a new low at 1.5157 level. We can consider this move as the end of the final wave 5 (coloured blue) of the bigger wave (1) (coloured green). At the moment the GBP/USD pair is trading around 1.5195 and we expect to see the price higher for the next few days. In accordance with our wave rules and taking into account that wave 2 should retrace minimum 50% of wave 1, we can define the potential targets with measuring wave 1 with take profit at 1.5377 (50% of wave 1). To reduce the risk, we can use invalidation point at 1.5157 level as stop loss.

Support and Resistance
(S3) 1.4998 (S2) 1.5078 (S1) 1.5122 (PP) 1.5202 (R1) 1.5246 (R2) 1.5326 (R3) 1.5370
Trading forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the upwards movement. That is why short  positions at level 1.5200 with stop loss at 1.5157 and take profit at 1.5377 are recommended. 

The material has been provided by InstaForex Company – www.instaforex.com