The BoE meeting minutes revealed less of an urgency to raise rates.  The dovish statements caused the Sterling to slide against most majors, or at least stop a prevailing bullish attempt. The GBP/USD however continued rallying showing even more USD weakness. The GBP/JPY and GBP/CHF stopped a rally, and the  EUR/GBP shows the Sterling recouping  losses in a throwback.

GBP/USD
- The GBP/USD is displaying strength despite the sterling-negative news on the back of USD-weakness. The whipsaw action during the release of the minutes showed respect to the 1.6310 pivot. It is now likely to be in the 3rd wave of a bullish impulse wave.
– We might see the market rally to complete this impulse wave, but it would be a terminal wave relative to the impulse wave that started on March 28.
– This means even if the market breaks above 1.6427 high, it is likely to be followed by a strong correction.
– Another impulse wave to follow this correction signals a breakout from the ranging action since Feb.
– The bullish target is the 1.69-1.7040(2009 high) zone. 

GBP/JPY
- The GBP/JPY was seen yesterday attempting to test a declining channel resistance.
– Today, the market is almost there, at 38.2% retracement of the decline from 140, and 61.8% retracement from the decline from 137.00.
– The price action following the BoE minutes release was a correction to the rally from 133.00.
– The bullish outlook is so far contained. In fact the 4H chart offers a negative reversal signal, suggesting bearish continuation towards 131.70, which would invalidate the bullish Elliott Wave count. The bearish scenario has a short-term target near the 126.00-126.50 area.
– The bullish outlook opens up only if the market can stay above the first resistance pivot of the current rally at 134.50. More importantly, a break above 136.10 is the initial clue of bullish continuation, with a break above 137.60, 61.8% retracement as a strong signal that the market is bullish.
– The bullish target in the medium term is near 146.


GBP/CHF
- The GBP/CHF was seen yesterday breaking above a narrow range of consolidation. The bullish target is 1.48.
– The BoE minutes hampered this development, but the market was spooked at 1.47 even before the release. The release only sped up the correction, and turned it into a deep pullback. The overlap of 1.46 invalidates some bullish scenarios, but we can be in a nested impulse wave.
– With the RSI in the 1H chart now returning above 40 after a brief break, the bullish momentum instill there.
– However, if the market fails to break back above the 1.4650 pivot, we might be in a bearish continuation.
– The bearish scenario targets 1.42, and 1.3750 in the medium term. A close in the 1H chart below 1.4520 opens up this scenario.

EUR/GBP
- The EUR/GBP broke above 0.88 in the European session as the BoE minutes came out.
– However, the US market did not continue this move. Instead there is a throwback.
– If the current decline breaks back below 0.88, and the 0.8790, 61.8% retracement level, we can be in a bearish continuation at least back down towards 0.8750 area, and can extend towards 0.8650.
– The bullish continuation scenario has a near-term target of 0.8940 Oct.26 high, then 0.9148, 2010 high.

Is the Sterling going to turn bearish after these minutes? We would love to hear your opinion.

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