Elliott Wave Analysis: GBPUSD Approaching Some Reversal Regions

By: Gregor Horvat | Thu, May 18, 2017
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GBPUSD is trading higher, breaking out of the triangle correction that was found in previous wave 4. As we know, triangle corrections occur prior to the final wave, which means current blue wave 5 may see limited upside! In that case, be prepeared for a reversal in three legs, that may follow in the near-term. Ideally resistance and a turning point lower will come around the 1.304/1.306 zone.

GBPUSD, 4H

GBP/USD 4-Hour Chart

A Triangle is a common 5-wave pattern labeled A-B-C-D-E that moves counter-trend and is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide 3-3-3-3-3.

In our example we can see a running triangle, where wave b terminates above the starting point of the previous wave a.

Triangle Correction:

Idealized Triangle Correction

Video analysis, where we talk about EURUSD, GBPUSD, USDCAD, USDCHF and Crude OIL

 


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Gregor Horvat

Author: Gregor Horvat

Gregor Horvat
www.ew-forecast.com

Gregor Horvat

Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of www.ew-forecast.com, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on: SafeHaven.com, FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At www.ew-forecast.com he helps clients and educate them about the Elliott wave prinicple and how to label and track unfolding patterns in real time.  His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty however is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators.

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