GBPUSD traded to an overnight high of 1.5308 missing my 1.5340 focus sell zone before catering over 150 pips to a 1.5150 low. Since then the retracement has been unusually strong tagging the .786 retracement of the 150+ pip move down. The Euro is also retracing the overnight losses, but nowhere near the degree that Sterling has, only testing the 50% retracement of the overnight losses. The Euro group is relatively weak this session so it is here where we will focus our attention. But first let's take a step back and look at 2 possible wave counts on the 180 min charts in EURUSD.
The first count labels the move into 1.3000 as the completion of a 4th wave flat correction that begin back in mid-May. If this is correct, wave 5 should bring us back towards the 1.1800 lows in coming weeks.
The second wave count labels the entire 5 wave completion at the early June lows, and we are rallying in a-of-II, with wave b and wave c yet to come. This count puts us into the b-wave, which should retrace at least 50% of the a-wave targeting a minimum test of 1.2450 in coming sessions.
In either wave count, the next 3-5% in EURUSD should be lower, so we are in fact Elliott-hedged.
The 15 min chart is our execution chart and shows our sell levels. I sold 1 unit of EURUSD on Twitter this morning at 1.2910. The stop on that unit is 1.3005 with a 1.2700 take profit. I have offers to sell another unit at 1.2950 with a different stop of 1.3032 and take profit of 1.2752. Keep an eye on the US 10 yr yield flirting with deadly and vulnerable support of 2.88%. The S&P is acting strong around 1060-area, so would like to see this level broken today to spike risk aversion and resulting USD buying pressure. If the S&P feels like it wants to hold this 1060 level, I will likely cut this EURUSD short. Please stay tuned to Twitter for further instructions.
Good articles but the layout and words are hard to read...
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