A rally in this past week through falling trend line connected from 1.425 top suggests that an impulsive wave (1) is finished and that larger corrective pull-back is underway. This is a blue wave (2), which must be subdivided by three legs before we may look for a downtrend continuation again. Nice resistance/reversal area for this wave (2) comes in at 1.3200-1.3500 range!

GBP/USD:

Cable rallied sharply in this past week with an increasing bullish momentum and the weekly close, which in fact also broke through falling trend line as shown on the chart. As such, we decided to adjust the wave count into more liekly scenario; incomplete wave 2) expanded flat formation. In this case price will rally above 1.5770 wave A top in coming week.