close icon

Theresa May Only Did the Bulls’ Dirty Work

It has been a wild ride for GBPUSD this week. The pair initially opened with a huge gap to the downside, following Theresa May’s “Hard Brexit” comments, but then reversed to the north to climb from as low as 1.1987 on Monday to as high as 1.2414 on Tuesday. It turned out that those, who followed the news and sold GBPUSD in pre-market were proven to be dead wrong by the illogical, but violent bullish swing that followed. However, our premium clients do not have to blame Theresa May for anything, because they have been warned that “the short-term charts suggest a recovery to 1.2430 is underway.” The next chart, in particular, was sent to clients before the market opened on Monday, January 16th.(some marks have been removed for this article)
theresa may gbpusd 4h 16.1.17
As visible, our Elliott Wave analysis suggested that GBPUSD might decline a little more in wave “b” of (b), but it was definitely not a time to sell it, because wave “c” of (b) was then supposed to lift it to the resistance area of wave 4 of (a) – above 1.2400. Today is Thursday and it is time to see how that forecast played out.
theresa may gbpusd 19.1.17
Think about the following paradox. GBPUSD plunges by nearly 18 figures on the day of the Brexit referendum, but rises by more than four after May’s promise to make Brexit as hard as possible. It does not make any sense, does it? Well, it does, at least according to the Elliott Wave Principle. Of course, it cannot tell you what someone is going to say, but it can often help you anticipate the market’s reaction to whatever is being said. And, in our opinion, this is much more important. Just ask Monday’s GBPUSD bears.

What to expect from now on? What is the bigger picture saying? Is GBPUSD going to continue even higher or the resistance near 1.2410 would turn out to be too strong for the bulls to breach? Prepare yourself for whatever is coming. Order your Elliott Wave analysis due out every Monday at our Premium Forecasts section. Stay ahead of the news in any market with the Elliott Wave principle.



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

EURUSD Up 420 Pips in a Month as Uptrend Resumes

The inevitable seems to be happening to the U.S. dollar. After record-breaking liquidity injections by the Fed in response to the COVID-19 crisis, the greenback is weakening across the board. The U.S. dollar has recently been declining against its major rivals, including the Yen, the pound and the euro. EURUSD, the most traded Forex pair…

Read More »

GBPJPY Bears Aiming at 120, Before Giving Up

Whether it is because of Brexit or not, GBPJPY has been trading below 160.00 ever since the referendum in June 2016. The pair has been locked in a wide range between 156 and 124 for four years now. Last week, it closed the session at 134.66, down from 138.84 at the open. In order to…

Read More »

Elliott Wave Setup Helps EURUSD Add 325 Pips

EURUSD has been under pressure for over two years now. The pair reached 1.2556 in February 2018, but has been making lower lows and lower highs ever since. Yet, the past couple of weeks painted a different picture. Between May 18th and May 29th, the euro surged 325 pips against the U.S. dollar. In those…

Read More »

EURGBP Pattern Signals Bullish Reversal Ahead

EURGBP has been in free fall since March 19th, when it rose to 0.9500. A month and a half later now, the pair is hovering below 0.8730, down 8% from the peak. Is the downtrend going to continue or should we expect a change of direction? That is the question we hope to answer in…

Read More »

GBPUSD Aiming at 1.30, but May Tumble to 1.21 First

Not long ago, we shared our long-term view of GBPUSD. In our opinion, the down-phase of the pair’s cycle, which is in its 13th year now, is almost over. One last dip to 1.1000 is likely to be followed by a major bearish reversal and the start of the next up-phase. Now, we are going…

Read More »

British Pound ‘s 13-Year Downtrend Almost Over

The thirteen-year period between 2007 and 2020 started with the biggest crisis since the Great Depression and is about to end with the biggest crisis since the Great Depression. Between the two, the longest economic expansion on record took place. And while stock markets around the world reflected that recovery, some currencies have been in…

Read More »

Ahead of the Move: EURUSD Adds 500 Pips in a Week

At the start of last week EURUSD was trading below 1.0700. The pair had fallen from as high as 1.1496 in just two weeks as coronavirus cases in Western Europe kept climbing disturbingly fast. And while fundamental traders had every reason to expect more weakness, the charts were sending a different message. The Elliott Wave…

Read More »

More analyses