Guest Commentary: GBP/USD - Currency Wars Can Be Both Profitable and Nasty Too!

DailyFX

* Cable remains within an aggressive downtrend showing very similar characteristics to the last 11 cent decline last May...the long awaited Nasty II trade.

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012313_Guest_Commentary_GBPUSD_Currency_Wars_Can_Be_Both_Profitable_and_Nasty_Too_body_Picture_1.png, Guest Commentary: GBP/USD - Currency Wars Can Be Both Profitable and Nasty Too!

Following the long awaited spike of 1.6380 and the trend sequence down to 1.5990 and the subsequent bounce to the 50% region, we have stayed short and added on what should prove to be a critical break of 1.5990.

So although the decline has slowed at the initial target area between the 4 month 1.5825 low and the 1.5790 equality target allowing more than one opportunity to reduce shorts and sucking in Eurodollar correlation longs, the current consolidation in a projected 1.5790-1.5895 range is merely pausing the downtrend and possibly providing another opportunity to sell above 1.59 at the 1.5920 50% retrace before Sterling breaks down again to the next target at the 1,618 multiple of 1.5550.

The 1.5970-90 previous lows should now cap to maintain momentum but our stops stay at 1.6040.

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