Support at 142.37 is protecting the downside. As long as this key-support is able to protect the downside, the pair will grow and may reach the target at 144.55. This is where we are expecting red wave v and black wave iii to peak for a more prolonged correction in black wave iv.
As black wave ii was a simple a deep zig-zag correction, we should expect a much more complex and shallow correction in wave iv, due to Elliott’s alternation principle.
A break below 142.37 will indicate red wave v and black wave iii has peaked and the stage now is ready for the correction in black wave iv. The minimum target for black wave iv is seen at 140.60 and likely closer at 139.30.
We took profit on 50% of our long GBP position at 143.15 and booked a nice 303 pips. On the final 50% we will keep our stop at 142.25 and take profit at 144.45 if seen.
The material has been provided by InstaForex Company – www.instaforex.com