In our previous analysis GBPUSD: Is Cable`s Consolidation Mature Yet?! the main count expected Cable to unfold downwards in an impulsive manner and Cable unfolded as expected and both targets were reached and exceeded locking in 107 pips in profit.
This week`s count expects Cable to continue unfolding downwards within a third wave impulse while the alternate count expects Cable to unfold in a sideways manner before resuming its downtrend.
As always we will wait for confirmation point to be reached to establish confidence in the main count`s view.
– Invalidation Point: 1.5060
– Confirmation Point: 1.4895
– Downwards Targets: 1.4861 — 1.4853 — 1.4800
– Wave number: iii lime
– Wave structure: Motive
– Wave pattern: Impulse
– Invalidation Point: 1.5060 — 1.4895
– Confirmation Point: 1.4957
– Upwards Targets: 1.4971
– Wave number: iv olive green
– Wave structure: Corrective
– Wave pattern: Zigzag
Elliott Wave chart analysis for the GBPUSD for 2nd December, 2015. Please click on the charts below to enlarge.
Main Wave Count
This count expects that primary wave C maroon is unfolding downwards and within it intermediate waves (1) and (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 waves i and ii pink are complete and wave iii pink is underway.
Within wave iii pink is underway with waves (i) and (ii) green complete and wave (iii) green is underway.
Within wave (iii) green it is likely that waves i and ii orange are complete and wave iii orange is at its early stages.
Within wave iii orange it is likely that waves 1 and 2 purple are complete and that wave 3 purple is underway.
Wave 1 purple unfolded as a leading diagonal labeled waves (1) through (5) aqua.
Wave 2 purple unfolded as a zigzag labeled waves (A), (B) and (C) aqua.
Within wave 3 purple it is expected that waves (1) and (2) aqua are complete and wave (3) aqua is subdividing downwards.
Within wave (3) aqua waves 1 and 2 red are complete and wave 3 red is underway.
Wave 1 red unfolded as an impulse labeled waves 1 through 5 lime.
Wave 2 red unfolded as a double zigzag labeled waves w, x and y lime.
Within wave 3 red, waves i and ii lime are complete and that wave iii lime is underway.
Wave i lime unfolded as an impulse labeled waves (i) through (v) olive green with wave (iv) olive green unfolding as a triangle.
Within wave iii lime it is likely that waves (i) through (iv) olive green are complete and that wave (v) olive green is unfolding downwards.
This count would be confirmed by movement below 1.4895.
For the first target we have a target zone that starts at 1.4861 as at that level wave (3) aqua would reach 4.236 of wave (1) aqua and that target zone ends at 1.4853 as at that level wave iii pink will reach 1.618 of wave i pink. Second target is at 1.4800 as at that level wave 3 purple would reach 2.618 of wave 1 purple.
This count would be invalidated by movement above 1.5060 as within wave iii lime wave (iv) olive green may not enter the price territory of wave (i) olive green.
Alternate Wave Count
The only difference between both main and alternate counts is within the subdivisions of wave (iv) olive green as this count expects that wave (iv) olive green has more to offer towards the upside.
This count would be confirmed by movement above 1.4957.
At 1.4971 wave (iv) olive green would reach 0.382 of wave (iii) olive green.
This count would be invalidated by movement above 1.5060 as wave (iv) olive green may not enter the price territory of wave (i) olive green and as well this count would be invalidated by movement below 1.4895 as within wave (iv) olive green no B wave may retrace more than 100 % of its A wave.