GBPUSD 25th August, 2015

Cable started the day by unfolding upwards and it fell short of the specified target by 4 pips before reversing directions and moving downwards.

We are modifying the subdivisions within wave (c) green for the main count according to the latest price action. On the other hand, The alternate count expects that a C wave is complete and that downwards impulse is underway.

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


Main Hourly Count

– Invalidation Points: 1.5617 — 1.5820
– Confirmation Point: 1.5721
– Upwards Targets: 1.5732 — 1.5749
– Wave number: B purple
– Wave structure: Corrective
– Wave pattern: —

Alternate Hourly Count

– Invalidation Point: 1.5820
– Confirmation Point: 1.5617
– Downwards Target: 1.5585 — 1.5499
– Wave number: iii orange
– Wave structure: Motive
– Wave pattern: Impulse

Elliott Wave chart analysis for the GBPUSD for 25th August, 2015. Please click on the charts below to enlarge.

Main Daily Wave Count

This count expects that primary wave B maroon is complete and that primary wave C maroon is unfolding towards the downside.

Within wave C maroon intermediate wave (1) black is complete as an impulse labeled minor waves 1 through 5 blue and intermediate wave (2) black might be complete as well and that intermediate wave (3) black has started unfolding downwards.

Within wave (1) black, wave 2 blue unfolded as a zigzag structure labeled minute waves a, b and c pink.

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

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

Intermediate wave (2) black unfolded as a zigzag labeled waves A, B and C blue.

Wave B blue unfolded as a zigzag labeled waves a, b and c pink.

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

Within intermediate wave (3) black it is expected that wave i pink is complete and that wave ii pink is unfolding towards the upside.

Wave ii pink is unfolding as a zigzag labeled waves (a), (b) and (c) green with waves (a) and (b) green complete and wave (c) green is underway.

We will be able to calculate a target for the completion of wave (c) green once we have confirmation that wave iv orange is complete by movement above 1.5820.

This count would be invalidated by movement above 1.5932 as wave ii pink may not retrace more than 100 % of wave i pink and as well this count would be invalidated by movement below 1.5424 as within wave (c) green no second wave may retrace more than 100 % of its first wave.

Main Hourly Wave Count

This count expects that wave C blue and therefore intermediate wave (2) black might be complete and that intermediate wave (3) black has started unfolding towards the downside.

Within intermediate wave (3) black, it is expected that wave i pink is complete and wave ii pink is underway.

Wave ii pink is unfolded as a zigzag labeled waves (a), (b) and (c) green with waves (a) and (b) green complete and wave (c) green is unfolding upwards.

Wave (b) green unfolded as a double combination labeled waves w, x and y orange.

Wave w orange unfolded as a three wave structure labeled waves A, B and C purple.

Wave x orange unfolded as a three wave structure labeled waves A, B and C purple.

Wave y orange unfolded as a three wave structure labeled waves A, B and C purple with wave C purple unfolding as an impulse labeled waves (1) through (5) aqua.

Within wave (c) green, it is expected that waves i through iii orange are complete and that wave iv orange is underway.

Wave i orange unfolded as an impulse labeled waves 1 through 5 purple.

Wave iii orange unfolded as an impulse labeled waves 1 through 5 purple.

Wave 1 purple unfolded as a leading diagonal labeled waves (1) through (5) aqua with each wave within that leading diagonal unfolding as a zigzag correction. It is worth noting that within wave (3) aqua wave C failed to exceed the high of wave A.

Wave 4 purple unfolded as a triangle labeled waves (A) through (E) aqua.

Within wave iv orange it is likely that wave A purple is complete and that wave B purple is unfolding upwards.

As far as MACD study goes, hourly MACD is exhibiting signs of a bullish divergence as MACD registered lower lows and price action failed to follow suit and it did not register a lower low and in the process a bullish divergence is formed.

This count would be confirmed by movement above 1.5721.

At 1.5732 wave B purple will reach 0.382 of wave A purple and at 1.5749 wave B purple will reach 50 % of wave A purple.

This count would be invalidated by movement above 1.5820 as wave B purple may not retrace more than 100 % of wave A purple. As well, this count would be invalidated by movement below 1.5617 as wave iv orange may not enter the price territory of wave i orange. It should be noted that the invalidation point will be moved to the end of wave A purple once we have confirmation on the hourly chart that wave B purple is underway.

Alternate Hourly Wave Count


N.B.: This count is presented on 6-hours chart for clarification purposes.

This count expects that wave ii pink is mature and that wave iii pink has started unfolding downwards.

Wave ii pink unfolded as a double zigzag labeled waves (w), (x) and (y) green.

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

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

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

Wave c orange within wave (y) green unfolded as an impulse labeled waves 1 through 5 purple.

Within wave iii pink it is likely that wave (i) green is unfolding downwards as an impulse labeled waves i through v orange with waves i and ii orange complete and wave iii orange is underway.

This count would be confirmed by movement below 1. 5617.

At 1.5585 wave iii orange will reach equality with wave i orange and the second target is at 1.5499 as at that level wave iii orange will reach 1.618 of wave i orange.

This count would be invalidated by movement above 1.5820 as wave ii orange may not retrace more than 100 % of wave i orange. It should be noted that the invalidation point will be moved to the end of wave ii orange once we have confirmation that wave iii orange is underway.

Food For Thought:

    The daily MACD has been hovering around the zero line for more than a few sessions, this behavior is typical of triangles, Even though it is early to judge such a triangle, this scenario expects that wave B blue within wave (2) black is underway as a triangle and that wave C blue is at its very early stages. Since this view expects upwards movement very similar to what the alternate count expects, we will keep track of this count and present it when/if it has higher probabilities.

    N.B.: Even though a count seeing wave iv orange complete as an expanded flat correction and that wave v orange is underway is technically valid. We decided to focus on the immediate short term in today`s analysis, keeping in mind that the main count expects upwards movement. The only difference between such a valid count and the main count is in the nature of the upwards movement.

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