GBPUSD 24th February, 2016

Cable unfolded downwards as expected and first target was reached and exceeded by 10 pips locking in 76 pips in profit.

We are updating the main count according to the latest price action, which expects that Cable has more to offer downwards and – as a reminder- we should keep in mind that both main and alternate counts have almost equal probabilities and more importantly we should be cautious as downwards movement is near completion.

Alternate hourly count expects that Cable has found a temporary bottom completing a third wave and that a fourth wave is expected to unfold in a sideways manner. -As a reminder- It is worth noting that alternate count`s confirmation point does not provide a practical value as we will soon discuss.

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

Main Hourly Count

– Invalidation Point: 1.4169
– Confirmation Point: 1.3878
– Downwards Target: 1.3865 — 1.3810
– Wave number: (iii) green
– Wave structure: Motive
– Wave pattern: ُImpulse

Alternate Hourly Count

– Invalidation Point: 1.4236 — 1.3878
– Confirmation Point: —
– Upwards Targets: 1.4080 — 1.4141
– Wave number: (iv) green
– Wave structure: Corrective
– Wave pattern: Zigzag

Elliott Wave chart analysis for the GBPUSD for 24th February, 2016. 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 waves (1) and (2) black might be complete and intermediate wave (3) black has started unfolding downwards.

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 minor waves 1 through 4 blue are likely complete with wave 1 blue unfolding as a leading diagonal labeled waves i through v pink.

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

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

Minor wave 2 blue was a shallow second wave and it unfolded as a zigzag correction labeled waves a, b and c pink.

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

This count expects that wave 4 blue is likely complete as a zigzag labeled waves a, b and c pink and that wave 5 blue has started unfolded downwards.

Within wave 5 blue waves i and ii pink are likely complete and wave iii pink is underway.

This count would be confirmed by movement below 1.3878.

At 1.3865 wave (iii) green would reach 1.618 of wave (i) green and at 1.3810 wave iii pink would reach 2.618 of wave i pink. Finally, at 1.3644 wave 5 blue would reach equality with wave 1 blue.

This count would be invalidated by movement above 1.4571 as within wave iii pink no second wave may retrace more than 100 % of its first wave.

Main Hourly Wave Count


N.B.: This count is presented on 2-hours chart for clarification purposes.

This count expects that minor waves 1 through 4 blue are likely complete and that minor wave 5 blue has started unfolding downwards.

This count expects that wave 4 blue unfolded as a zigzag labeled waves a, b and c pink and that wave 5 blue has started unfolding towards the downside.

Wave a pink unfolded as a leading diagonal labeled waves (i) through (v) green.

Wave c pink unfolded as an impulse labeled waves (i) through (v) green with wave (iv) green unfolding as an expanded flat correction.

Within wave 5 blue, it is likely that waves i and ii pink are complete and that wave iii pink is extending downwards.

Wave i i pink unfolded as an impulse labeled waves (i) through (v) green and wave (iii) green unfolded as an impulse labeled waves i through v orange with wave v orange being a truncated fifth wave.

Wave ii pink unfolded as double combination labeled waves (w), (x) and (y) green and that wave iii pink is unfolding downwards.

Within wave iii pink, waves (i) and (ii) green are likely complete complete and wave (iii) green is expected to unfold downwards.

Wave (i) green unfolded as an impulse labeled waves i through v orange with wave i orange unfolding as a leading diagonal labeled waves 1 through 5 purple.

Wave (ii) green unfolded as a three wave structure labeled waves a, b and c orange.

Within wave (iii) green waves i through iv orange are complete and wave v orange is unfolding downwards.

As far as MACD study goes, MACD is forming a bearish divergence as MACD failed to follow price action as price action failed to make a new high while MACD readings continued upwards forming a new high.

This count would be confirmed by movement below 1.3878.

At 1.3865 wave (iii) green would reach 1.618 of wave (i) green and at 1.3810 wave iii pink would reach 2.618 of wave i pink.

This count would be invalidated by movement above 1.4169 as within wave v orange, no second wave may retrace more than 100 % of its first wave.

Alternate Hourly Wave Count


N.B.: This count is presented on 2-hours chart for clarification purposes.

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 structurally mature and therefore wave (iii) green is expected complete and that wave (iv) green has started unfolding upwards.

This count`s confirmation point is at the end of wave iv orange at 1.4169 and since the first target would be reached before reaching this confirmation point, the confirmation point is expected to be of lower value as it will not be practical.

At 1.4080 wave (iv) green would reach 0.382 of wave (iii) green and at 1.4141 wave (iv) green would reach 50 % of wave (iii) green.

This count would be invalidated by movement below 1.3878 as within wave (iv) green no B wave may retrace more than 100 % of its A wave. As well this count would be invalidated by movement above 1.4236 as wave (iv) green may not enter the price territory of wave (i) green.

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