GBP 10Aug09

The Sterling Pound turned quite abruptly from 1.7042, and has already moved below 1.6600. There is some mild support around 1.6563, and more at 1.6515. Because we had an extending third wave (at 2.618 times the first), we should be wary of a correction back to at least 1.6715/20. This could come from either 1.6565 or 1.6515 levels. HOwever, I would not be happy to trade any big size from the long side, given the fact we have likely placed a significant top already and a move back to 1.5800 ( or a lot lower: see earlier comments) is anticipated in the big picture. Be careful below 1.6400 as there is a key support down there.