Cable unfolded as expected and both targets were reached and exceeded by 4 pips before reversing directions and moving towards the upside.
This week`s main count expects Cable to continue towards the downside in a motive manner within an ending diagonal while the alternate count expects that Cable has more to offer towards the upside in a corrective wave (ii).
In a nutshell, the main count expects one last push towards the downside before reversing directions towards the upside in a mid term uptrend. While the alternate count expects that downwards movement has more to offer towards the downside.
As always we will wait for either count`s confirmation point to be reached to determine the highly probable count.
6-Hours Main Count
– Invalidation Point: 1.5683 — 1.5389
– Confirmation Points: 1.5486
– Downwards Targets: 1.5464
– Wave number: v pink
– Wave structure: Motive
– Wave pattern: Ending diagonal
6-Hours Alternate Count
– Invalidation Point: 1.5683 — 1.5486
– Confirmation Points: —
– Upwards Target: 1.5607
– Wave number: (ii) green
– Wave structure: Corrective
– Wave pattern: Zigzag
Elliott Wave chart analysis for the GBPUSD for 26th December, 2014. Please click on the charts below to enlarge.
Main Wave Count
This count expects that wave B maroon is complete and that wave C maroon is unfolding towards the downside.
Within wave C maroon wave (1) black is at its late stages.
Wave (1) black is unfolding as an impulse labeled waves 1 through 5 blue with waves 1 through 4 blue complete and wave 5 blue is unfolding towards the downside.
Wave 1 blue unfolded as a leading diagonal labeled waves i through v pink.
Wave 2 blue unfolded as a zigzag labeled waves a, b and c pink.
Wave 3 blue unfolded as an impulse labeled waves i through v pink with wave iii pink unfolding as an impulse labeled waves (i) through (v) green.
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.
Wave 5 blue is expected to be unfolding towards the downside as an ending diagonal with waves i through iv pink are expected complete and wave v pink is unfolding towards the downside.
This count would be confirmed by movement below 1.5486.
At 1.5464 wave v pink will reach 0.618 the length of wave iii pink.
This count would be invalidated by movement above 1.5683 as wave iv pink may not exceed the end of wave ii pink within an ending diagonal and it should be noted that the invalidation point will be moved to the end of wave iv pink once we have confirmation on the hourly chart that wave v pink is unfolding towards the downside. 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 Wave Count
Within wave 5 blue waves i and ii pink are expected complete and wave iii pink is extending towards the downside.
Wave i pink unfolded as an impulse labeled waves (i) through (v) green.
Within wave iii pink wave (i) green is expected complete and wave (ii) green is unfolding towards the upside.
At 1.5607 wave (ii) green will reach 0.618 the length of wave (i) green.
This count would be invalidated by movement below 1.5486 as within wave (ii) green no B wave may retrace more than 100 % the length of an A wave. As well this count would be invalidated by movement above 1.5683 as wave (ii) green may not retrace more than 100 % the length of wave (i) green.