Cable has been climbing since early September which was consistent with my prior count of a wave (iv) bounce but in October that count started to have problems with overlap. I think the follow EW count looks better and is at an interesting point. Here I am treating the low this year as a (b) wave and expecting a (c) wave advance for wave [iv]. You can plainly see a five wave move up from the low has taken place and now against resistance at 1.3231. At a minimum, bulls should manage, bears can begin to take a position though lower risk, but worse trade location, if they wait for a drop under 1.3028.
My contrarian frame of mind has me thinking that GBP is working on a major low. Monthly and weekly charts below.
Two resistance zones to watch
I’ve been asked for an update on GBP and since the equity indices should quiet down over the next 1.5 hours till the FOMC statement, think I have enough time to get this done.
Overall think GBP, like many of the major USD crosses, has spent the last year correcting up in a wave [iv] and should be close to pressing lower in a wave [v] over the next 18 months.
Happy Thanksgiving! I thought I would see if I can sneak in a little analysis before slipping into a turkey induced coma.