April 18, 2009 - PART 2
This part is a continuation from part 1 that I posted before. You should read part 1 first.
In this scenario, I want to discuss about GBP long term direction from Delta perspective as a result of what happens if ITD 8 / MTD 11 has arrived on April 16 at 1.5067. So in this scenario, let's assume that ITD 8 / MTD 11 has arrived on April 16 at 5067
If this happens, the more important question to ask is whether LTD 15 is also IN together with ITD 8/ MTD 11, and whether SLTD 2 low is already IN at LTD 14. This is such an important question because it concerns the long term direction of GBP. Is GBP heading below 1.35 in the long term? Or is GBP heading above 1.5067 in the long term?
So here first of all, I want to specifically address the long term direction of GBP purely from Delta system perspective first, then later I will add some more observation from other trading methods to determine to the best of my ability the most probable outcome.
This part is a continuation from part 1 that I posted before. You should read part 1 first.
In this scenario, I want to discuss about GBP long term direction from Delta perspective as a result of what happens if ITD 8 / MTD 11 has arrived on April 16 at 1.5067. So in this scenario, let's assume that ITD 8 / MTD 11 has arrived on April 16 at 5067
If this happens, the more important question to ask is whether LTD 15 is also IN together with ITD 8/ MTD 11, and whether SLTD 2 low is already IN at LTD 14. This is such an important question because it concerns the long term direction of GBP. Is GBP heading below 1.35 in the long term? Or is GBP heading above 1.5067 in the long term?
So here first of all, I want to specifically address the long term direction of GBP purely from Delta system perspective first, then later I will add some more observation from other trading methods to determine to the best of my ability the most probable outcome.
Assuming ITD 8 / MTD 11 is IN on April 16, Delta rule states that LTD 15 could be IN here with MTD 11 OR LTD 15 could also be IN later with MTD 1. Delta rule also states that SLTD 2 could be IN with LTD 14 last time, or SLTD 2 could also be IN later with LTD 16.
To answer that question, I attach Delta - LTD chart. As you can observe from the chart, in previous 2 cycles, LTD 15 was due on March and April. And in previous 2 cycles, SLTD 2 was due together with LTD 16 on June and July.
The whole idea of Delta is that pattern tends to repeat again. So at first glance, Delta - LTD chart observation may seem to support the idea that LTD 15 is DUE here and SLTD 2 LOW is not yet due IF GBP USD's pattern this year is to repeat like previous 2 cycles. If that is the case, then we should expect GBP USD from this point to go progressively lower and breaks below 1.35 in coming months.
The whole idea of Delta is that pattern tends to repeat again. So at first glance, Delta - LTD chart observation may seem to support the idea that LTD 15 is DUE here and SLTD 2 LOW is not yet due IF GBP USD's pattern this year is to repeat like previous 2 cycles. If that is the case, then we should expect GBP USD from this point to go progressively lower and breaks below 1.35 in coming months.
Attached is another Delta chart to show what will happen using these assumptions:
1. ITD 8 / MTD 11 was due on April 16
2. LTD 15 was also due on April 16 together with ITD 8 / MTD 11
3. SLTD 2 was not yet IN.
Using assumptions above, we would never see in the coming months price level above 5067, and will trade progressively down and break lower than 1.35 per my chart.
But again, the pattern this year doesn't really have to repeat previous 2 cycles as I already said the Delta rules allow LTD 15 to be due on MTD 1 later and SLTD 2 to be due on LTD 14 last time. In fact, in the next part, I would argue that even if ITD 8 / MTD 11 is already due on April 16, it's more probable that LTD 15 is NOT due with ITD 8 / MTD 11 and that SLTD 2 WAS probably already due on LTD 14. In other words, in the next part I will argue that SLTD 2 WAS already IN, and LTD 15 will not be due until MTD 1 later (around May - June).
