April 18, 2009 - PART 3
This part is a continuation from previous 2 parts. You should read them first.
In this part, I want to present some charts to support my theory that IF ITD 8 / MTD 11 is DUE on April 16 at 5067, LTD 15 is NOT YET DUE with them, and that SLTD 2 COULD HAVE BEEN DUE with LTD 14 last time.
Again, the assumption here is that ITD 8 / MTD 11 is already DUE on April 16 at 5067.
The charts I want to present are:
1. GBP USD Elliot Wave Chart
2. USD Index Monthly Chart
3. GBP USD Monthly Chart
1. Chart 1: GBP USD Elliot Wave Chart.
As far as I know, attached is the most commonly used Elliot Wave count for GBP USD from the Ellioticians. So I will just go with them. What Ellioticians say is that GBP USD has not completed 5 waves from the high of 2.116 in Nov 2007, and that we are now in the process of completing wave C of 4, then after wave C of 4 is complete, we will go down breaking below 1.35 in wave 5.
So let's take a look at current Elliot Wave count attached. Although we could count 5 waves up from the end of wave B of 4 like I propose in the chart, we could observe that wave 1 and wave 4 of C overlaps, and also the 5 wave structure of Wave C just doesn't look right and complete to me.
This part is a continuation from previous 2 parts. You should read them first.
In this part, I want to present some charts to support my theory that IF ITD 8 / MTD 11 is DUE on April 16 at 5067, LTD 15 is NOT YET DUE with them, and that SLTD 2 COULD HAVE BEEN DUE with LTD 14 last time.
Again, the assumption here is that ITD 8 / MTD 11 is already DUE on April 16 at 5067.
The charts I want to present are:
1. GBP USD Elliot Wave Chart
2. USD Index Monthly Chart
3. GBP USD Monthly Chart
1. Chart 1: GBP USD Elliot Wave Chart.
As far as I know, attached is the most commonly used Elliot Wave count for GBP USD from the Ellioticians. So I will just go with them. What Ellioticians say is that GBP USD has not completed 5 waves from the high of 2.116 in Nov 2007, and that we are now in the process of completing wave C of 4, then after wave C of 4 is complete, we will go down breaking below 1.35 in wave 5.
So the question is whether it's possible that 5067 is the end of wave C of 4. If it is, according to this EW count, GBP will then break lower than 1.35. This to me sounds very similar to Delta theory that LTD 15 is DUE together with ITD 8 / MTD 11 and SLTD 2 is not yet due.
We have determined that Wave A of 4 has 3 subwaves, Wave B of 4 also has 3 subwaves, and Wave C of 4 therefore must have 5 subwaves (3-3-5 corrective pattern).
So let's take a look at current Elliot Wave count attached. Although we could count 5 waves up from the end of wave B of 4 like I propose in the chart, we could observe that wave 1 and wave 4 of C overlaps, and also the 5 wave structure of Wave C just doesn't look right and complete to me.
So a daiy Elliot Wave chart observation does not really convince me that we have reached the end of wave C at 5067. I thus favor the idea that 5067 IS NOT THE TOP of wave C of 4.
2. Chart 2: USD Index Monthly Chart
2. Chart 2: USD Index Monthly Chart
As spectacular as USD rally in recent days, in USD Index Monthly Chart attached, we observe a monthly bearish engulfing candle suggesting that USD is topping off. On top of that, we also observe a monthly bearish divergence between price and RSI.
To me, this suggests that new lows in GBP USD (or other currencies like EUR USD, AUD USD) in the coming several months are not likely.
3. Chart 3: GBP USD Monthly Chart
From GBP USD Monthly Chart, we see how RSI is so in deeply oversold region. We observe it starts to turn up, and most likely we will finish the month of April in positive candle. Taken together, this may signal further bullish potential, instead of breaking lower than 1.35.
We also observe in the past between year 2000 - 2002 how price fluctuates around 1.4 for 18 months. This is a reference point to check how fast we should break lower than 1.35, especially considering that we are still in very deeply RSI oversold region
Taken together, these three charts above suggest to me a more probable outcome of long term bullishness in GBP USD. And thus, I would argue that even if ITD 8 / MTD 11 has been due on April 16, the long term direction is still UP even though the medium term direction will be DOWN.
