* Euro Sterling remains in a medium term uptrend ultimately destined for new highs.
* The recent price action (break of weekly downtrend resistance) confirms the necessary 'Paradigm Shift' and an associated quantum leap in volatility similar to 2008.
* Besides staying long, there is a clear trading strategy to take advantage of an unusually aggressive market.
The last 48 hours confirms that the rally through 85 was indeed the midpoint point and that Euro Sterling has undergone a paradigm shift…You have to go back to the January 2008 to find analogous price action.
The spike to 8715 has completed a trend sequence from 8550 (with an extended fifth) and therefore a trend sequence from 8265. But it hasn't ended the major move from 8085 (the third wave).
The current reaction should ideally retrace to 8605 initially the 23.6% and the extension point from where it should doubly retrace back into the 8715 high in a pivotal 8605-8715 consolidation. Although it is tempting to look for a later deeper retracement to 8540 38.2% and the previous corrective low, Euro Sterling is only answering a 36 hour 60 point correction at this point. It could easily break up from a retest of the broken weekly trend resistance now support at 8605 in a 240 5=1 move to a seemingly outrageous 8820-8880 target area to end the major third wave before correcting to 8550 (38.2%) possibly 8460 next time.
So we are staying long and looking to add to after the next 3 wave corrective retracement with 8450 short term stops.
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