GBPUSD: Is Cable`s Uptrend Exhausted Yet?

In our previous analysis GBPUSD: Upwards Correction vs. Downtrend Reversal ! Cable unfolded exactly as expected with first target reached and exceeded and Cable fell short of the second target -at 1.4640- by less than one pip before reversing directions.

To answer today`s question "Is Cable`s uptrend exhausted yet ?", we should delve deeper into both main and alternate charts. In a nutshell, the main count allows for one more push upwards to complete the corrective pattern while the alternate count expects that Cable`s uptrend is mature and that Cable is within its early stages within a downwards impulse.

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

Main Count

- Invalidation Point: 1.5932 -- 1.4322
- Upwards Targets: 1.4670 -- 1.4683
- Wave number: (c) green
- Wave structure: Motive
- Wave pattern: ُImpulse/Ending diagonal

Alternate Count

- Invalidation Point: 1.4640
- Confirmation Point: 1.4004 -- 1.3835
- Downwards Target: 1.3591
- Wave number: 3 blue
- Wave structure: Motive
- Wave pattern: ُImpulse

 

Big Picture

The weekly chart suggests that wave C maroon is unfolding downwards as an impulse with waves (1) and (2) black complete and wave (3) black is extending downwards.

Within wave (3) black, it is expected that wave 1 blue is complete and that wave 2 blue is unfolding upwards in a corrective manner.

It would be confirmed that wave 3 blue is underway by movement below 1.3835.

Main Wave Count

This count expects that wave 1 blue is complete as an impulse labeled waves i through v pink with wave v pink unfolding as an impulse labeled waves (i) through (v) green.

Within minor wave 2 blue, waves w and x pink are complete and that wave y pink has started unfolding upwards.

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

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

Wave (b) green unfolded as an expanded flat correction labeled waves a, b and c orange with wave b orange unfolding as a zigzag labeled waves A, B and C purple.

After the completion of wave (b) green, wave (c) green unfolded as an impulse labeled waves i through v orange.

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

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

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

Within wave y pink, waves (a) and (b) green are complete and that wave (c) green is underway.

Within wave (c) green it is likely that waves i and ii orange are complete and that wave iii orange has started unfolding upwards.

This count would be confirmed by movement above 1.4640.

At 1.4670 wave iii orange would reach 0.618 of wave i orange and at 1.4683 wave y pink would reach equality with wave w pink.

This count would be invalidated by movement below 1.4322 as wave ii orange may not retrace more than 100 % of wave i orange and it should be noted that the invalidation point would be moved to the end of wave ii orange once we have confirmation on the hourly chart that wave iii orange is underway. As well this count would be invalidated by movement above 1.5932 as wave 2 blue may not retrace more than 100 % of wave 1 blue.

Alternate Wave Count

The difference between both main and alternate counts is within the subdivisions within wave y pink.

This count expects that wave y pink is complete and that wave 3 blue has started unfolding downwards.

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

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

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

This count would be initially confirmed by movement below 1.4004 and the final confirmation point is at 1.3835.

A very conservative initial target for wave 3 blue is at 1.3591 as at that level wave 3 blue would reach 50 % of wave 1 blue and we will be able to refine that target once wave 3 blue starts subdividing downwards.

This count would be invalidated by movement above 1.4640 as within wave 3 blue no second wave may retrace more than 100 % of its first wave.

We may also wish to keep an eye on the daily update GBP USD Forecast.