Outlook: lower in wave ‘iii’ black, with a long way down to go. Possible shorting opportunity at the wave ‘ii’ black high.
My long trade in GBPUSD has worked very well so far.
I placed a buy order at 13145 last week, today the price rallied to 13440.
This trade is well in the money and I have now moved up my protective stop to 13355,
there is now 200 points in the bag, and anything else is a bonus.
I placed the limit at the 13600 target.
The market rallied off the open today but as usual the power came in when the US market opened.
the upper target on cable is in the region of 13650,
The market stands at 13430 as I write, so there is room to move to the upside from here if everything goes to plan.
Right now I suspect that the market is moving within wave ‘v’ green,
this wave will probably extend to fill the gap between here and the upper target.
A fifth wave extension will usually travel an equal amount of points as the previous wave three.
wave ‘iii’ green travelled about 300 points
so an extended wave ‘v’ green could reach a similar point.
If you add 300 to the wave ‘iv’ green low you get an upside target of around 13580.
In the short term chart I have shown a red arrow pointing to the impulsive part of the rally.
This could be a third wave move within that wave ‘v’ green.
Third waves and C waves are where the power lies in any Elliott wave form.
so when I see a vertical move like this one in the 10 minute chart,
I immediately suspect that it is a third wave.
If this is the case, then we can expect further moves to the upside into the end of the week.
For tomorrow, I will be watching for further advances,
With each shelf of support I will be moving the protective stop higher with every chance.
Takeaway’s:
- protective stop moved to 13355.
- wave ‘v’ green possibly extending to the upside
- Trade limit is set at 13600.
