GBP/JPY
Commentary – We wrote last week that “is last week’s bearish engulfing pattern yet another one false reversal signal.” Apparently so, because the GBPJPY ripped through 242.97 and now trades north of 246.00. Is the psychological 250.00 in the cards? 246.25 was where wave 5 (beginning from 237.64) would have equaled wave 1 (221.05-229.66). With price trading close to this level, a bearish outcome is possible. We will not look to get bearish though until we see a clear 5 waves down (impulsive). Daily RSI is above 70 (overbought) for the first time since January. A break below the trendline drawn off of the 3/14 and 6/8 lows would signal a reversal.

Strategy – None

GBP/CHF
Commentary – We wrote last week that “since the 5/15 low, the GBPCHF appears to have traced out a 1 and 2, with the current rally (from 2.4149) as wave 3. A measured objective for bulls is the 161.8% extension of 2.4059-2.4437/2.4149 (wave 1) at 2.4761. This is also the 1/23 high at 2.4757.” Today’s high was at 2.4745 so the pair is at its estimated resistance zone. The short term charts are noisy right now so we took a look at the weekly for perspective. The 61.8% of 2.7319-2.0928 is at 2.4878, a potential long term reversal point. Also, the rally from 2.0928 takes on the shape of a 3 wave correction. In summary, we expect a poke above 2.4757 and a reversal with serious long term implications.

Strategy – None

GBP/AUD
Commentary – There is no change to the outlook for the GBPAUD. “The next bearish price target is where wave 3 (beginning at 2.4295) would equal wave 1 (2.5492-2.3733) at 2.2536. Near term, a correction is unfolding from 2.3295 that should extend to 2.3921 (or close to it). The decline from 2.3921 was an extended 5th wave and extended 5th waves are often fully retraced. Look to add to bearish positions near 2.3921 and keep risk at 2.4295.”

Strategy – Bearish now, against 2.4295, target 1 is 2.2540

Jamie Saettele is a Technical Currency Analyst for FXCM.