Ending Diagonal Puts GBPUSD Into A Bearish Mode

Cable has turned bearish in the shape of an ending diagonal from 1.6243 to 1.7180 that caused a sharp drop in price during the summer.

In fact, the current decline also broke beneath the red trend-line connected from the 1.6460 level that suggests a top is in place, especially if we also consider an impulsive manner from the high.

With that said, GBPUSD will likely remain under pressure in the weeks ahead, while any pullbacks should be corrective and limited on the upside.

GBPUSD Daily Elliott Wave Analysis

As expected, GBPUSD broke to a new low as the rally from the last two weeks to 1.6640 was nothing else than just a correction within the ongoing downtrend. We see prices now falling in a fifth wave, which is a final leg within a larger degree of an impulsive wave structure. We are talking about wave (1) that may find a low by the end of the week. Sooner or later, a new correction will follow, ideally one that will be in three leg up in wave (2).

GBPUSD 4h Elliott Wave Analysis

Gregor Horvat

Grega Horvat Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of Ew-Forecast, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At Ew-forecast he helps clients and educates them about the Elliott wave principle and how to label and track unfolding patterns in real time. His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty, however, is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators. EW-Forecast To be involved in the market effectively, you need the right guidance and resources, and our team can help you to achieve that. Our team is providing advanced informations about Elliott Wave theory in real time. The Elliott Wave Principle gives you a method for identifying the behavior of the markets and at what points the market is most likely to turn. We help new traders who are interested in Elliott Wave theory to understand it correctly. We are doing our best to explain our views as simple as possible with educational goal, because knowledge itself is power!

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