Wave Analysis:
Just as in Euro, the cable retraced lower than expected and even broke below the short term support level 1.2184 but got supported by the lower supportive trend line. We expect the upward rally witnessed following the rebound from this trend line to be the unfolding of the corrective wave (b) and should not go beyond 1.2184 from where we’ll be looking to sell the impulsive wave (5). Any clear break above 1.2184 will invalidate the anticipated bearish price rally and could push the price further to the upper side but should not go beyond 1.2289. Expect an exact opposite price action in USDCHF and USDJPY. These pairs have a strong negative correlation to the cable and will move in different directions during this intraday.
Trade Recommendations:
Wait for a clear rebound from 1.2184 to go short with an ideal target at 1.19. Any clear break above 1.2184 will call for long positions with an ideal target at 1.2725
Origin: FreshForex
