GBPUSD – Cable`s Christmas Elliott Wave Analysis

Cable started the week by confirming the main count and first target was reached and exceeded before reversing directions and moving towards the upside to confirm the alternate count and target was exceeded by 2 pips. This is not a typical behavior for Cable and this is why we reviewed the recent subdivisions to present the counts that provide us with the "best fit".

This week`s main count expects Cable to continue towards the downside in an impulsive manner while the alternate count expects Cable to reverse directions and move towards the upside within wave (2) black.

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

16-Hours Main Count

- Invalidation Point: 1.5737
- Confirmation Points: 1.5539
- Downwards Targets: 1.5519 -- 1.5490
- Wave number: iii pink
- Wave structure: Motive
- Wave pattern: Impulse

6-Hours Alternate Count

- Invalidation Point: 1.5539 -- 1.7193
- Confirmation Points: 1.5683
- Upwards Targets: 1.5743 -- 1.5828
- Wave number: iii pink
- Wave structure: Motive
- Wave pattern: Impulse

Main Wave Count

This count expects that wave B maroon is complete and that wave C maroon is unfolding towards the downside.

Within wave C maroon wave (1) black is at its late stages.

Wave (1) black is unfolding as an impulse labeled waves 1 through 5 blue with waves 1 through 4 blue complete and wave 5 blue is unfolding towards the downside.

Wave 1 blue unfolded as a leading diagonal labeled waves i through v pink.

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

Wave 3 blue unfolded as an impulse labeled waves i through v pink with wave iii pink unfolding as an impulse labeled waves (i) through (v) green.

Wave 4 blue unfolded as a double combination labeled waves w,x and y pink with wave y pink failing to create a new high above the end of wave w pink.

Within wave 5 blue waves i and ii pink are expected complete and wave iii pink is unfolding towards the downside.

It is likely that wave iii pink is extending towards the downside with waves (i) and (ii) green complete and wave (iii) green is underway.

This count would be confirmed by movement below 1.5539.

At 1.5519 wave iii pink will reach 200 % the length of wave i pink and at 1.5490 wave 5 blue will reach 50 % the length of wave 3 blue.

This count would be invalidated by movement above 1.5737 as within wave iii pink wave (ii) green may not retrace more than 100 % the length of wave (i) green. It should be noted that the invalidation point will be moved to the end of wave (ii) green once we have confirmation on the hourly chart that wave (iii) green is unfolding towards the downside.

Alternate Wave Count

This count expects that wave (1) black is complete and that wave (2) black is unfolding in a sideways manner.

Wave (1) black unfolded as an impulse labeled waves 1 through 5 blue.

Wave 4 blue unfolded as a triangle labeled waves a through e pink and this structure fulfills the rule of alternation between waves 2 and 4 blue.

Wave (2) black is unfolding as a flat correction with waves A and B blue complete and wave C blue is starting to unfold towards the upside.

Wave B blue unfolded as a double combination labeled waves w, x and y pink.

Within wave C blue waves i and ii pink are likely complete and wave iii pink is expected to unfold towards the upside.

Cable is expected to continue moving towards the upside to reach 1.5743 where wave iii pink will reach equality with wave i pink and if exceeded then to 1.5828 where wave iii pink will reach 1.618 the length of wave i pink.

Upwards movement would be confirmed by movement above 1.5683.

This count would be invalidated by movement below 1.5539 as within wave C blue wave ii pink may 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 unfolding towards the upside. 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.