Gbp/Usd - Still no relief, or is there

Traders are still looking for support on cable that will give some hope back to the pound after the more the 2000 pips drop in one month. Prices broke through this 76.4% Fibonacci support very powerfully and now are already threatening the next 261.8% Fibonacci extended level of the blue wave A). If this one holds then we can expect move back to 76.4%; just above 1.8000. The market however is still making new lows, so any long positions could be very hard to time, and very hard to hold for anything more that a relief bounce.

We have clearer picture about the last five waves in big red C on the chart below. Wave three is almost always the most powerful and largest wave of the five sequences, and this is the reason that makes the divergences on our indicators; on the chart below we have the example of this situation. Remember that this is still not the long signal, we are just showing what may be developing right know. Traders should wait until Thursday’s rate decision from the U.K. Holding rates may make for a stronger pound, for a little while anyway.

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