GBPUSD – More Gains For Cable Are On The Horizon

Last week, Cable unfolded as expected however it is yet to reach the main count`s confirmation point.

Cable ended the week almost where it started and that indicates indecision between bulls and bears. According to the main count`s view bulls should have the upper hand even if just temporarily.

On the other hand, the alternate count -which has lower probabilities as it does not provide the best fit- expects Cable to resume its decline in an impulsive manner.

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

6-Hours Main Count

- Invalidation Point: 1.5874 -- 1.7193
- Confirmation Point: 1.6185
- Upwards Targets: 1.6304 -- 1.6378
- Wave number: iii pink
- Wave structure: Motive
- Wave pattern: Impulse

6-Hours Alternate Count

- Invalidation Point: 1.6185
- Confirmation Point: 1.5874
- Downwards Targets: 1.5784 -- 1.5536
- Wave number: (iii) green
- Wave structure: Motive
- Wave pattern: Impulse

N.B.: I apologize for the bad quality of my voice in this week`s video analysis as I am going through a bad case of flu affecting my voice.

Main Wave Count

This count expects that wave B maroon is complete as a zigzag labeled waves (A), (B) and (C) black and that wave C maroon is unfolding towards the downside.

Within wave C maroon wave (1) black is expected complete as a leading diagonal labeled waves 1 through 5 blue and that wave (2) black is unfolding towards the upside.

Wave 1 blue unfolded as a zigzag labeled waves a, b and c pink.

Wave a pink unfolded as an impulse labeled waves (i) through (v) green.

Wave c pink unfolded as an impulse labeled waves (i) through (v) green.

Wave 2 blue unfolded as a double zigzag labeled waves w, x and z pink.

Wave 3 blue unfolded as a zigzag labeled waves a, b and c pink.

Wave 4 blue unfolded as a zigzag labeled waves a, b and c pink.

Wave 5 blue unfolded as a double zigzag labeled waves w, x and y pink.

With the completion of wave (1) black, wave (2) black is expected to be underway with wave A blue unfolding towards the upside as an impulse labeled waves i through v pink with waves i and ii pink complete and wave iii pink is at its early stages.

This count would be confirmed by movement above 1.6185.

At 1.6304 wave iii pink will reach equality with wave i pink and at 1.6378 wave (2) black will reach 0.382 the length of wave (1) black.

This count would be invalidated by movement below 1.5874 as wave ii pink may not retrace more than 100 % the length of wave i pink and it should be noted that the invalidation point will be moved to the end of wave ii pink once we have confirmation on the hourly chart that wave iii pink is underway. As well this count would be invalidated by movement above 1.7193 as wave (2) black may not retrace more than 100 % the length of wave (1) black.

Alternate Wave Count

This count has lower probabilities as it does not provide the best fit.

Wave C maroon is expected to be unfolding towards the downside and within it wave (1) black is underway.

Within wave (1) black waves 1 and 2 blue are expected complete and wave 3 blue is unfolding towards the downside.

Wave 1 blue unfolded as an impulse labeled waves i through v pink.

Wave 2 blue unfolded as a zigzag labeled waves a, b and c pink.

Within wave 3 blue waves i and ii pink are expected complete and wave iii pink is underway.

Wave i pink unfolded as an impulse labeled waves (i) through (v) green with wave (iii) green unfolding as an impulse labeled waves i through v orange.

Wave ii pink unfolded as a double zigzag labeled waves (w), (x) and (y) green with each wave within that double zigzag unfolding as a three wave structure labeled waves a, b and c orange.

Within wave iii pink waves (i) and (ii) green are expected complete and wave (iii) green is at its early stages.

Wave (i) green unfolded as an impulse labeled waves i through v orange.

This count would be confirmed by movement below 1.5874.

At 1.5784 wave (iii) green will reach 0.618 the length of wave (i) green and at 1.5536 wave (iii) green will reach equality with wave (i) green and it is worth mentioning that these targets are considered conservative and will be updated as wave (iii) green starts its development towards the downside.

This count would be invalidated by movement above 1.6185 as within wave (iii) green no second wave may retrace more than 100 % the length of the first wave.

Food For Thought: According to the main count, wave (2) black is expected to be underway. Second waves following a leading diagonal -represented by wave (1) black- are known to be very deep corrections, however the way we setup the main count`s targets, keeps in mind the minor possibility of a shallow correction for wave (2) black. That possibility would assume that within wave (2) black, waves A and B blue are complete and that wave C blue is unfolding towards the upside.