GBPUSD – 4th April, 2014 – Monthly

Over the last month, Cable unfolded towards the downside leaving both counts valid as it is yet to reach either count`s confirmation point.

Cable has been trading in a sideways manner within a range for the past four years -since mid 2009- and that is indicative of a corrective movement. Lately, Cable has been trying to test the upper boundary of that sideways movement. We will be discussing three different scenarios shortly.

We are updating both counts according to the latest price action and as well adding a third count which has lower probabilities at the time being as it does not provide the best fit.

Main Daily Count

– Invalidation Point: 1.6460 — 1.6787
– Confirmation Point: 1.6684
– Upwards Targets: 1.6691 — 1.6728
– Wave number: c orange
– Wave structure: Motive
– Wave pattern: Impulse/Ending diagonal

Elliott Wave chart analysis for the GBPUSD for 4th April, 2014. Please click on the charts below to enlarge.

Main Weekly Wave Count

01-gbpusd03apr14monthly

This count expects that wave A maroon are complete and that wave B maroon is unfolding in a sideways manner as a triangle.

Wave A maroon unfolded as an impulse labeled waves (1) through (5) black.

Wave B maroon is unfolding as a triangle labeled waves (A) through (E) black with waves (A), (B) and (C) black complete and wave (D) black is unfolding towards the downside.

Wave (A) black unfolded towards the upside as a zigzag labeled waves A, B and C blue.

Wave (B) black unfolded towards the downside as a zigzag labeled waves A, B and C blue.

Wave (C) black unfolded towards the upside as a zigzag labeled waves A, B and C blue.

Wave B blue unfolded towards the downside as a double zigzag labeled waves w, x and y pink with wave W blue unfolding as a zigzag labeled waves (a), (b) and (c) green and wave x pink unfolded as a zigzag labeled waves (a), (b) and (c) green. Wave y pink unfolded as a zigzag labeled (a), (b) and (c) green.

Wave C blue unfolded as an impulse labeled waves i through v pink.

As far as Japanese candlesticks study goes, no clear pattern appears at this point.

This count would be confirmed by movement below 1.6252.

At 1.5083 Wave (D) black will reach 0.618 the length of wave (B) black.

This count would be invalidated by movement above 1.6823 as within wave A blue within wave (D) black no second wave may retrace more than 100 % the length of the first wave as well this count would be invalidated by movement below 1.4227 as wave (D) black may not move below the end of wave (B) black within a contracting triangle.

Main Daily Wave Count

01-gbpusd04apr14daily

This count expects that wave B maroon is unfolding as a triangle labeled waves (A) through (E) black with waves (A) and (B) black complete and wave (C) black is likely complete and that wave (D) black is starting to unfold towards the downside.

Wave (C) black unfolded towards the upside as a zigzag labeled waves A, B and C blue.

Wave C blue unfolded as an impulse labeled waves i through v pink.

Wave iii pink unfolded as an impulse labeled waves (i) through (v) green.

Wave (iii) green unfolded as an impulse labeled waves i through v orange with wave iii orange unfolding as an impulse labeled waves 1 through 5 purple.

Wave (iv) green unfolded as a zigzag labeled waves a, b and c orange.

Wave iv pink unfolded as a zigzag labeled waves (a), (b) and (c) green.

Wave v pink unfolded towards the upside as an impulse labeled waves (i) through (v) green.

Within wave (D) black, wave a pink is unfolding towards the downside as an expanding leading diagonal with waves (i) through (iii) green complete and wave (iv) green is unfolding towards the upside.

Within wave (iv) green waves a and b orange are likely complete and wave c orange is starting to unfold towards the upside.

As far as Japanese candlesticks study goes, no clear pattern appears at this point.

This count would be confirmed by movement above 1.6684.

At 1.6691 wave c orange will reach 0.618 the length of wave a orange and at 1.6728 wave c orange will reach 0.786 the length of wave a orange.

This count would be invalidated by movement above 1.6787 as within a leading diagonal wave (iv) green may not exceed the end of wave (ii) green, as well this count would be invalidated by movement below 1.6460 as within wave (iv) green wave b orange may not retrace more than 100 % the length of wave a orange and it should be noted that the invalidation point will be moved to the end of wave b orange once we have confirmation that wave c orange is unfolding towards the upside.

First Alternate Weekly Wave Count

02-gbpusd03apr14monthlyalt

The alternate weekly count expects that wave (C) black is incomplete and that it has more to offer towards the upside before reversing directions and moving towards the downside within wave (D) black.

Within wave (C) black waves A and B blue are expected complete and wave C blue is unfolding towards the upside.

Within wave C blue waves i through iv pink are expected complete and wave v pink is underway.

This count would be confirmed by movement above 1.6823.

At 1.6873 wave v pink will reach equality with wave i pink.

This count would be invalidated by movement above 1.7043 as wave (C) black may not exceed the end of wave (E) black within a contracting triangle, as well this count would be invalidated by movement below 1.6252 as within wave v pink no second wave may retrace more than 100 % the length of the first wave.

Second Alternate Weekly Wave Count

02-gbpusd03apr14monthlyalt2

This count is a very bearish count and it expects that waves A and B maroon are complete and wave C maroon is starting to unfold towards the downside.

A couple of points that make this count -less than ideal- scenario, and it should be noted that we will keep an eye on this count for further confirmation/invalidation:
1- Wave (5) black within wave A maroon was a truncated fifth wave and -even though- that is valid, a truncation on this level is quite rare.
2- The truncated fifth wave -wave (5) black should subdivide into a five wave structure and the lack of a clear five wave structure within wave (5) black lowers the probabilities of this count.
3- Wave B maroon fell short of the 0.382 the length of wave A maroon, however with a truncation present one should expect more upwards momentum to push that correction further.
4- Wave (C) black failed to reach equality with wave (A) black.

This count would be confirmed by movement below 1.4227.

At 1.4174 wave C maroon will reach 0.382 the length of wave A maroon and at 1.2538 wave C maroon will reach 0.618 the length of wave A maroon and finally at 0.9889 wave C maroon will reach equality with wave A maroon.

This count would be invalidated by movement above 1.6823 as within wave C maroon no second wave may retrace more than 100 % the length of the first wave.

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