GBPUSD – Outside Day highlights a base

Monthly: Moved higher from the 2016 low of 1.1905. Levels close to be bespoke resistance at 1.4390 found sellers. Aprils price action formed bearish Outside Bar, often an indication that the rally (correction) has come to an end. Follow through selling pressure has resulted in GBPUSD trading to the lowest level in 7 months. Reverse trend line support is located at 1.2755

Weekly: After completing a bullish Elliott Wave pattern (5-waves) a bearish Outside Week was posted from the high (1.4377). Levels close to the 50% pullback of 1.3133) have found buyers. We now look for the first corrective leg lower to be complete.

Daily: Posted a DeMark 13 (exhaustion) count on the daily chart. Although the selloff passed the 261.8% extension of 1.3176 (from 1.4377-1.3918), we look for this to be a 5^th wave extension (Elliott Wave). Bullish divergence can be seen on the daily (the chart makes a lower low while the oscillator makes a higher low), often a signal of exhausted bearish momentum, or at least a correction higher. This fact, combined with a bullish Outside Day from yesterday, makes the outlook positive. Bespoke support is located at 1.3230