Elliott Wave Analysis of the GBP/USD Currency Pair by Sid from ElliottWavePredictions.com. Click on the charts twice to enlarge.
The British Pound appears likely to be making one last push to the upside. The target zone for the end of the rally that started in mid-January is essentially between 1.625 and 1.63. Once an upward impulse from today’s low of 1.60661 is complete, if my long held wave count of a 3-year-long triangle is correct, a downward thrust will ensue, with a preliminary downside target of about 1.267. It is worth noting that the GBP is notorious for truncated 5th waves, so the orthodox end of the upward structure could fall short of the April 30 (wave 3 green) high of 1.6301. Invalidation of the triangle concept is at 1.67460, and if my 180 minute wave count is correct, movement below 1.59848 will confirm the trend change.
As described in my last post regarding the USD/JPY pair, I closed all long positions last night at 79.5 for a net gain of 240 pips, and also took profit this morning on my Euro short with a gain of 250 pips. Obviously, I could have made a lot more on the Yen trade by exiting back in late March, but wanted to stay in position to take advantage of any additional Central Bank intervention. I’m now expecting a bounce in US equities (but not to new highs), while the Euro should recover a bit here as well. I’ll be looking for the proper vehicles to use to get long the US dollar again within the next few days, and will post according (time-permitting), and will describe in detail during this weekend’s live webinar.