[B]Commentary:[/B] Cable has backed off following the spike through the resistance line drawn off of the 6/12 and 7/3 highs. The short term pattern that we favor remains similar to that of the EURUSD. We are treating the spike this morning to 2.0541 as the top of wave b (or ii). Therefore, we are looking for a decline in wave c (or iii) to just below 2.0459.
This indicates a very short term bearish opportunity, but the trend remains bullish above 2.0365 (as the count shown today indicates). A new high (above 2.0547) would be wave iv within the rally from 2.0056 (which is larger wave 3) and give way to a larger correction. A break of 2.0364 indicates additional bearish potential (and potentially a significant reversal). [B]Strategy:[/B] Flat