GBP/USD: wave analysis

The pair may fall.

On the 4-hour chart, a downward correction of the higher level developed as the wave (2), and the formation of the third wave (3) started. Now, the first wave 1 of (3) is forming, within which the third wave of the lower level iii of 1 has formed, and a downward correction may develop as the wave iv of 1. If the assumption is correct, the pair will fall to the levels of 1.2597–1.2502. In this scenario, critical stop loss level is 1.2996.

Main scenario

Short positions will become relevant during the correction, below the level of 1.2996 with the targets at 1.2597–1.2502. Implementation period: 7 days and more.

Alternative scenario

The breakout and the consolidation of the price above the level of 1.2996 will let the pair grow to the levels of 1.3167–1.3387.

Scenario

Timeframe Weekly
Recommendation SELL
Entry Point 1.2922
Take Profit 1.2597, 1.2502
Stop Loss 1.2996
Key Levels 1.2502, 1.2597, 1.2996, 1.3167, 1.3387

Alternative scenario

Recommendation BUY STOP
Entry Point 1.3000
Take Profit 1.3167, 1.3387
Stop Loss 1.2940
Key Levels 1.2502, 1.2597, 1.2996, 1.3167, 1.3387