The move to the downside is logical, because the pair rallied with almost 400 pips without any significant correction, and we can count on the chart not seven, not nine, but thirteen waves to the upside. That is a quite the rare case, usually after nine sub-waves there is a deeper correction than the one we witnessed here, but now we could expect said deeper correction to occur.
The RSI divergence is present on the M15, H1 and H4 time frames.
On the H4 time frame the limit of the divergence is around 1.2250.
Of course, we should not overlook the possibility for a new move to the upside, after the correction is over. I think that the target to the upside is at 1.2550 – 1.2600.
Good post!
ReplyDeleteExcellent observation!
ReplyDeletePound holds the gains.
ReplyDeleteGood tip! I'll keep it in mind.
ReplyDeleteIt's still quite bullish.
ReplyDeleteTaking note of key levels to keep track and follow up.
ReplyDeleteInteresting analysis, thanks.
ReplyDelete