GBPUSD seems to be progressing within Wave 5, towards 1.2900 and 1.3200 respectively. Bulls are expected to remain in control for now and prices are expected to stay above 1.2300 handle in the short term. A break above 1.3200 and 1.3500 would also confirm a long term trend reversal in GBPUSD.
Structurally, GBPUSD has been dropping since last several years in an ending diagonal. The last leg seems to have terminated at 1.1414 handle. Bulls need to break above 1.3500 to confirm that the diagonal structure was complete at 1.1414.
Since printing lows at 1.1414, GBPUSD has carved a series of higher highs and higher lows until recent highs around 1.2800 handle. Medium term structure reveals that the currency has carved Waves 1, 2, 3 and 4 respectively as labelled on the chart here. Wave 4 found support at the fibonacci 0.382 retracement of Wave 3 around 1.2100.
After turning higher from 1.2100 handle, GBPUSD has been progressing within Wave 5 and is close to terminating around 1.2900 levels. The fibonacci 0.618 extension of lower degree waves are also pointing towards 1.2920 levels, for Wave 5 to complete.
Looking at the short term wave counts within Wave 5, GBPUSD seems to have terminated lower degree waves I, ii, iii and iv (not labelled here). Wave iv, might have terminated around 1.2458 recently. If the above counts are correct, GBPUSD should be now progressing within the final sub wave v towards 1.2900 and 1.3200 levels respectively.
Long against 1.1414, targeting above 1.2900 and 1.3200.
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