GBPJPY
GBPCHF
GBPAUD
Commentary – We wrote last week that “a top may be in place at 240.67. The decline from 240.67-235.90 is in 5 waves and suggests that another 5 wave decline will follow. Short term bearish targets are 234.04 and 231.09 (100% and 161.8% extensions of 240.67-235.90/238.81.” The GBPJPY dropped to 230.28 on 10/22. We are treating the decline from 240.67 as a series of 1st and 2nd waves. Wave ii of 3 is underway now and we expect it to end after a spike through 235.83. 238.81 must remain intact for the bearish bias to remain favored. Coming under 230.28 confirms that the next leg lower is underway.
Strategy – Get bearish near 236.00, against 238.81, targets TBD (probably below 220.00).
Commentary – The dominant pattern in this chart is the decline from 2.4963, which is in 3 waves. The subsequent rally from 2.3487-2.4205 is a 5 wave advance, which indicates that the larger trend is up. A rally through 2.4205 exposes the 100% extension of 2.3487-2.4205/2.3789 at 2.4507. The near term picture is bullish as long as price is above 2.3789.
Strategy – Exit bearish position (at a profit)….flip to long against 2.3789, targets 2.4507 and 2.4951
Commentary – We wrote last week that “the rally from 2.2425 is most likely the 4th wave correction within the 5 wave decline from 2.5638. Potential resistance is at the 10/3 high at 2.3165 and the 38.2% of 2.5638-2.2425 at 2.3352. A rally to one of these levels should give way to a top and reversal. A new low is then expected to register below 2.2425 in wave 5 before a larger recovery.” The GBPAUD topped at 2.3200 (between the 2 levels we cited) and price is well on its way to a new low (beneath 2.2427). Again, we will look to identify the bottom and reversal as this pattern progresses.
Strategy – Flat