GBP/USD Prepares for Short-term Bullish Rally in Wave B

Dear traders, the GBP/USD bullish breakout managed to reach the previous top… But ultimately reversed at the 100% Fibonacci level. What is the next expected price swing?

1 hour chart

The GBP/USD seems to have completed 5 waves down (dark red), which could be part of a wave A (green) of a larger zigzag correction. The ABC (green) zigzag is most likely extending the WXY (blue) corrective pattern. A bullish breakout above resistance (red) would confirm a bullish swing and potential ABC up within wave B (green).

A break above the 100% Fibonacci level of wave B vs A invalidates the ABC, whereas a bounce at the Fibs and break below the support (blue) confirm (green check) it. A bearish continuation is aiming for the Fibonacci levels of wave Y vs W. The main target is the 100% Fibonacci level (red circle) but price can fall short or extend beyond this level too.

Good trading,

Chris Svorcik

The analysis has been done with the help of SWAT method (simple wave analysis and trading)

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