GBPUSD - Will it go "BOOM or BUST"

FX:GBPUSD   British Pound/U.S. Dollar
1165 14 4
GBP has been relatively very weak since the start of this year and almost looks like it is in free fall. There are many analyst and commentators are pointing to GBPUSD             which appears to have formed a symmetrical triangle with suggestion that it is "doomed". They many well be right. However, whilst accepting that it is at critical level, I am reluctant to agree with them. I note that It has tended to almost move in the same direction (see chart below) as Dollar Index             since 3rd January. It does not sound logical that the pair which has inverse relation ship to Dollar Index             could continue for extended period following Dollar Index             lower. By now you will know my longer term view on the Dollar Index             and can check it out at
. Unless UK is in worst position than many of its neighbours. There for normal inverse relation ship to the Dollar Index             is likely to be restored sooner rather than later. My reasons for this is as follows:- (1) that the modified pitchfork applies has been use full in picking up important reaction points highlighted and is again approaching the rising lower parallel pitchfork line. (2) The move higher from June low appears being retraced in an expanded flat ABC             correction where wave (b) goes beyond the origin of wave (a) and wave (c) goes beyond the origin of wave (b), and wave (a) & wave (b) on the chart appears to be zigzag and hence the wave (c) is in minor 5 wave decline (feature of Flat Correction in EW principle). (3) If this is the case then we re in the final move down which could end around 1.56 where several Fib confluence & lower parallel Pitchfork line meets and is accompanied with potential RSI divergence with price. (4) Friday's action             against most GBP pairs is showing very big bearish candle after noticeable decline already, hence could be be capitulation action             . I suspect next week two will provide further clarity. Either confirming my analysis and view noted above or in going BUST.
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Close up of the previous daily charts with EW labels (which are different from what they showed in the original chart and subsequent updated chart but one which I think better represents what price data show at present) and with AB=CD measured move and accompanying potential RSI divergence also suggest that we might have a bottom in the region. The new regarding the Triple "A" rating will likely cause opening Gap Down for the coming week and perhaps even more decline as capitulation takes place and will form the bottom from which a new uptrend or just partial retracement of the entire decline will likely take place and on confirmation and with acceptable risk I will be looking for long entry. Also to note that Dollar Index could also form a top around the current level. If this does not play out, I will not get worked up about it and will reconsider. May be just stand a side if required.
Further, in addition to horizontal support zone, we have now reached bottom of the declining trend channel and at a level where there are several fib confluence as can be seen from the Daily chart of the GBPUSD.
Last Friday, it appeared that the possible bottom was being formed, till UK's Triple "A" rating was lost and GBPUSD started to sell of again. However, What surprises me in a manner of speaking is that why all the negative new flow, Banks recommending selling GBPUSD etc when GBPUSD has been in in decline right from 1st day of trading this year and GBPUSD is now approaching horizontal level (Zone) which previously acted as support. IN this chart I of GBPUSD ETF I see clear divergence (assuming the data is correct) divergence with OBV (which can persist for some time and could also fail completely) with price and also longer term potential divergence with RSI could also develop but not yest confirmed. That is the background of why I am still looking for long trade and one which will be profitable even if it only makes partial retracement.
Lot have happened with the GBPUSD since publishing my chart originally, which, I posted with the view to stalking long trade entry at safe place. The original level has been violated with quite some power. However, my style of trading is to look for possible swing that would last for several days and weeks, therefore, I am still looking for long entry. Many would suggest that there are so much negative new flow and comments by BOE current governor and one who is to succeed, in addition to several large Banks now either lowering downside target for GBPUSD or are out right making claims that it should be sold. Now we have UK's Triple "A" Rating is lost late last Friday. So I could be completely wrong with my analysis and yes could have joined the short-side and made money. That is all with the hindsight. Whilst I do not discourage anyone wishing to consider short trade (that has never been my intention), I did not know based on my analysis published how far or how long it might take for me to find the stalked long entry. Nor I or most could have known that short trade could have lasted for so long and with such decline in actual price. Therefore, I am still looking for long entry, even if the price do not go back to the high of year but only make partial retracement. Once I find that entry point which could be confirmed then I will enter long trade. Till then I will not chase price or jump in prematurely. I think any who read my comments and consider what I show in my analysis needs to accept that and individually make your own decision whichever that is. Having said all that I wish to update the analysis and show where the potential long entry might develop and why. These are in the charts that follows
Here is the Chart with larger time frame. It is my attempt to show that this pair will find a bottom in the current price level and will develop new up trend and that is is not a symmetrical (bearish) triangle that many have been talking about.
Since publishing the chart, GBPUSD has experienced sharp sell off. Overall that does not change the expectation of a bottom to form for new uptrend or sizable retracement. However, based on the details already presented, I still think the chart is valid, even though the actual swings labels need adjusting or modifying. So I am still looking for a long entry and feel it could develop tomorrow or early next week. Here is the short term count which suggest that the 5 wave decline is very mature and could complete soon.

At the time of checking the data price seems to be lagging, but you can see that OBV is also potentially suggesting bullish action from GBPUSD

The actual low appear to be formed little lower than originally anticipated but still with in the range identified. Yesterday's pinbar and today's partial retracement might be all that is needed for long entry with relatively small risk. Alternatively could look to enter on continuation above yesterday's high.
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