GBPUSD 29th December, 2014

Today Cable unfolded towards the downside which is more in line with the main count we have and the confirmation point is yet to be reached.

I am updating the main count adding tighter confirmation point. We have to keep in mind that this count expects one last decline towards the downside to complete intermediate wave (1) black and upwards reversal to follow within intermediate wave (2) black.

An alternate count is presented which expects that intermediate wave (1) black is complete and that intermediate wave (2) black is at its very early stages. It is worth noting that the hourly confirmation point is only a short term confirmation point and that the final confirmation point is by movement above the end of minor wave 4 blue.

As always we will wait for either count`s confirmation point to be met to determine the highly probable count.

Main Hourly Count

– Invalidation Point: 1.5587 — 1.5389
– Confirmation Points: 1.5506
– Downwards Targets: 1.5464
– Wave number: v pink
– Wave structure: Motive
– Wave pattern: Ending diagonal

Alternate Hourly Count

– Invalidation Point: 1.5486 — 1.7193
– Confirmation Points: 1.5587
– Upwards Target: 1.5607 — 1.5668
– Wave number: (iii) green
– Wave structure: Motive
– Wave pattern: Impulse

Elliott Wave chart analysis for the GBPUSD for 29th December, 2014. Please click on the charts below to enlarge.

Main Daily Wave Count

gbpusd29dec14daily1

This count expects that wave B maroon is complete as a zigzag labeled waves (A), (B) and (C) black and that wave C maroon is starting to unfold towards the downside.

Within wave C maroon wave (1) black is at its late stages with waves 1 through 4 blue complete and wave 5 blue is unfolding towards the downside.

Within wave (1) black Wave 1 blue unfolded as a leading diagonal labeled waves i through v pink.

wave 2 blue unfolded as a zigzag structure labeled waves a, b and c pink.

Wave 3 blue unfolded as an impulse labeled waves i through v pink.

Wave 4 blue unfolded as a double combination labeled waves w,x and y pink with wave y pink failing to create a new high above the end of wave w pink.

This count would be confirmed by movement below 1.5486.

At 1.5464 wave v pink within wave 5 blue will reach 0.618 the length of wave iii pink and at 1.5419 wave 5 blue will reach 0.618 the length of wave 3 blue.

This count would be invalidated by movement above 1.5787 as within wave 5 blue no second wave may retrace more than 100 % the length of the first wave.

Main Hourly Wave Count

gbpusd29dec14hourly
gbpusd29dec14hourlymacd

This count expects that wave (1) black is at its late stages with waves 1 through 4 blue complete and wave 5 blue is unfolding towards the downside.

Wave 4 blue unfolded as a double combination labeled waves w, x and y pink.

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

Wave (a) green unfolded as an impulse labeled waves i through v orange.

Wave (b) green unfolded as a triangle labeled waves a through e orange.

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

Wave 5 blue is likely to be unfolding as an ending diagonal labeled waves i through v pink with waves i through iv pink complete and wave v pink is unfolding towards the downside.

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

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

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

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

As far as MACD study goes, MACD is not showing any sign other than the bearish crossover. I do not trust crossovers as they tend to happen frequently, provide a lot of false signals and are not reliable.

The lower black trend line connecting minute waves i and iii pink should provide support to further downwards movement.

This count would be confirmed by movement below 1.5506.

At 1.5464 wave v pink will reach 0.618 the length of wave iii pink.

This count would be invalidated by movement above 1.5587 as within minute wave v pink no B wave may retrace more than 100 % the length of an A wave. Also this count would be invalidated by movement below 1.5389 as by movement below that level wave iii pink will be the shortest wave and that violates Elliott`s rule that a third wave cannot be the shortest wave.

Alternate Hourly Wave Count

gbpusd29dec14hourlyalt

This count expects that intermediate wave (1) black is complete and that intermediate wave (2) black is at its early stages.

Minor wave 4 blue unfolded as a triangle labeled minute waves a through e pink.

Minute wave b pink unfolded as a double zigzag labeled minuette waves (a), (b) and (c) green.

Within intermediate wave (2) black minuette waves (i) and (ii) green are expected complete and minuette wave (iii) green is expected to be unfolding upwards.

This count would be initially confirmed by movement above 1.5587.

At 1.5607 minuette wave (iii) green will reach equality with minuette wave (i) green and at 1.5668 minuette wave (iii) green will reach 1.618 the length of minuette wave (i) green.

This count would be invalidated by movement below 1.5486 as minuette wave (ii) green may not retrace more than 100 % the length of minuette wave (i) green. It should be noted that the invalidation point will be moved to the end of minuette wave (ii) green once we have confirmation on the hourly chart that minuette wave (iii) green is underway. As well this count would be invalidated by movement above 1.7193 as intermediate wave (2) black may not retrace more than 100 % the length of intermediate wave (1) black.

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