GBPUSD 27th August, 2015

Even though Cable continued downwards as expected under the alternate count and target was reached and exceeded. The nature of the downwards movements was impulsive in nature suggesting that a five wave structure is complete.

Furthermore, MACD registered a divergence on the hourly chart, typical of fifth waves supporting the main count view. Wave five exceeded equality with wave one by 1 pip.

We are updating the main count according to the latest price action and providing an alternate count which expects that a fifth wave is incomplete and that Cable 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.

Main Hourly Count

– Invalidation Points: 1.5820 — 1.5370
– Confirmation Point: 1.5510
– Upwards Targets: 1.5540 — 1.5595 — 1.5646
– Wave number: (ii) green
– Wave structure: Corrective
– Wave pattern: Zigzag

Alternate Hourly Count

– Invalidation Point: 1.5510
– Confirmation Point: 1.5370
– Downwards Target: 1.5321 — 1.5290
– Wave number: v orange
– Wave structure: Motive
– Wave pattern: Impulse/Ending diagonal

Elliott Wave chart analysis for the GBPUSD for 27th 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 likely complete and wave iii pink might be at its early stages.

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

This count would be confirmed by movement below 1.5330.

At 1.5223 wave iii pink will reach equality with wave i pink and at 1.5853 wave iii pink will reach 1.618 of wave i pink.

This count would be invalidated by movement above 1.5820 as within wave iii pink 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 might be complete and wave iii pink is at its early stages.

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

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

Wave c 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.

This count expects that wave iii pink is at its early stages with wave (i) green complete as an impulse labeled waves i through v orange and wave (ii) green is unfolding towards the upside.

As far as MACD study goes, hourly MACD is exhibiting signs of a bullish divergence as MACD failed to register a lower low and price action continued lower and registered a lower low and in the process a bullish divergence is formed.

This count would be confirmed by movement above 1.5510.

At 1.5541 wave (ii) green will reach 0.382 of wave (i) green and at 1.5594 wave (ii) green will reach 50 % of wave (i) green. Finally at 1.5646 wave (ii) green will reach 0.618 of wave (i) green.

This count would be invalidated by movement above 1.5820 as wave (ii) green may not retrace more than 100 % of wave (i) green. As well, this count would be invalidated by movement below 1.5370 as within a zigzag correction no B wave may retrace more than 100 % of its A wave.

Alternate Hourly Wave Count

The only difference between both main and alternate counts is within the subdivisions of wave v orange.

This count expects that wave v orange is incomplete and that it has more to offer towards the downside.

This count would be confirmed by movement below 1.5370.

Since wave v orange was 1 pip longer than equality with wave i orange, the next logical target is at At 1.5321 as at that level wave v orange would reach 1.382 of wave i orange and the second target is at 1.5290 as at that level wave v orange would reach 1.618 of wave i orange.

This count would be invalidated by movement above 1.5510 as within wave v orange no second wave may retrace more than 100 % of its first wave.

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