Sterling Support Approaching – 1.5450

It has been 2 weeks since we posted on the GBPUSD (“Elevated Probability of a 200 Pip Sell Off”).

The sell off cut deeper so the higher probability counts are getting shifted around. It appears there are support and wave relationships coming from multiple angles into the 1.5450-1.5550 zone. So the higher probability opportunity is to trade around that zone.

The June 18-24 sell off has many wave relationships that indicate it is impulsive. I have it labeled as wave (a). Within (a):

• Wave iii traveled nearly 2.618* wave i
  Wave v traveled nearly .618 * wave i-iii
  Wave v terminated near the 2-4 trend channel
  

June 24-29 is clearly a correction of the down move.

June 29 thru today is lining up as impulsive with today’s high being wave 4 printing near the 38.2% retracement of wave 3.

The wave count shown on the chart above suggests blue wave ‘v’ comes to an end perhaps as early as next week in the zone (scenario #1). At that point, it would launch a rally towards 1.62.

A break above the upper blue trend line builds the case for a large rally.

So I’m cautiously bullish into the zone cited.

Much deeper than 1.5450 then we’ll likely step aside and wait for clarity.

Sentiment is tame at +1.16 so that doesn’t contribute to a bias.

Your higher probability count is appreciated, especially if different. I’m interested in other competing views.

Good luck!