On our previous analysis the main count expected Cable to unfold downwards within a third of a third wave and Cable unfolded as expected sharply towards the downside.
Since we are all familiar with the main daily count that we discuss day in and day out, we will take the chance and discuss two alternate counts which have high probabilities.
The main count -as we will soon discuss- agrees with the main daily count we are familiar with for the short term and disagrees with that count for the mid and long term.
On the other hand, the alternate count expects Cable to push upwards in a corrective manner before resuming its downtrend.
As always, we will wait for either count`s confirmation point to be reached to determine the highly probable count.
– Invalidation Point: 1.2915
– Confirmation Point: 1.1970
– Downwards Targets: 1.1950 — 1.1808 — 1.1750
– Wave number: v pink
– Wave structure: Motive
– Wave pattern: ُImpulse / Ending diagonal
– Invalidation Point: 1.2915 — 1.1970
– Confirmation Point: 1.2484
– Upwards Targets: 1.2492 — 1.2600
– Wave number: iv pink
– Wave structure: Corrective
– Wave pattern: ُZigzag
Elliott Wave chart analysis for the GBPUSD for 13th October, 2016. Please click on the charts below to enlarge.
Main Wave Count
This count is a conservative count and the only reason this count is not considered the main count on the daily analysis because of the time relationship between waves 2 and 4 blue as wave 4 blue is 40 days shorter than wave 2 blue.
This count expects that wave C maroon of primary degree is unfolding towards the downside.
Within wave C maroon intermediate waves (1) and (2) black are complete and intermediate wave (3) black is at its late stages.
Within intermediate wave (3) black it is expected that minor waves 1 through 4 blue are complete and that wave 5 blue is underway.
Minor wave 1 blue unfolded as an impulse labeled waves i through v pink.
Minor wave 2 blue unfolded upwards likely as a double zigzag correction labeled waves w, x and y pink.
Wave w pink unfolded as a zigzag labeled waves (a), (b) and (c) green.
Wave x pink unfolded as a zigzag labeled waves (a), (b) and (c) green.
Minor wave 4 blue unfolded as a double zigzag labeled waves w, x and y pink.
Within minor wave 5 blue it is likely that waves i through iv pink are complete and that wave v pink is at its early stages.
This count would be confirmed by movement below 1.1970.
At 1.1950 wave v pink would reach 0.618 of wave i pink and the second target is based on a thrust out of a triangle -wave iv pink- by extending a line connecting waves B and D and by running a vertical line from the end of wave A to touch the B, D line. That target is at 1.1808 and finally at 1.1750 wave v pink would reach equality with wave i pink.
This count would be invalidated by movement above 1.2915 as wave iv pink may not enter the price territory of wave i pink. It is worth noting that the invalidation point should be moved to the end of wave iv pink once we have confirmation on the daily chart that wave v pink is unfolding downwards.
Alternate Wave Count
The difference between both main and alternate counts is within the subdivisions of wave iv pink as this count expects that wave iv pink is incomplete and that wave iv pink is unfolding as a zigzag towards the upside.
Within wave iv pink it is likely that waves (a) and (b) green are complete and wave (c) green has started unfolding upwards.
This count would be confirmed by movement above 1.2484.
At 1.2492 wave (c) green would reach 0.786 of wave (a) green and at 1.2600 wave (c) green would reach equality with wave (a) green.
This count would be invalidated by movement above 1.2915 as wave iv pink may not enter the price territory of wave i pink. As well, this count would be invalidated by movement below 1.1970 as within wave iv pink wave (b) green may not retrace more than 100 % of wave (a) green. It is worth noting that the invalidation point would be moved to the end of wave (b) green once we have confirmation on the hourly chart that wave (c) green is unfolding upwards.