In this technical blog we’re going to take a look at the Elliott Wave charts charts of GBPJPY published in members area of the website. Recently the pair corrected the cycle from the 139.7 peak , when recovery unfolded as Irregular Elliott Wave Flat structure. These kinds of movements are Traps for traders as the market gives 5 waves structure in the direction against the trend. We at Elliott Wave Forecast can spot such patterns early by looking at the structure of internal subdivision, looking at price distribution and using market correlation strategies.
In further text we’re going to explain the forecast and Elliott Wave Pattern. Before we take a look at the real market example of Expanded Flat, let’s explain the pattern in a few words.
Elliott Wave Expanded Flat Theory
Elliott Wave Expanded Flat is a 3 wave corrective pattern which could often be seen in the market nowadays. Inner subdivision is labeled as A,B,C , with inner 3,3,5 structure. Waves A and B have forms of corrective structures like zigzag, flat, double three or triple three. Third wave C is always 5 waves structure, either motive impulse or ending diagonal pattern. It’s important to notice that in Expanded Flat Pattern wave B completes below the start point of wave A, and wave C ends above the ending point of wave A which makes it Expanded. Wave C of expanded completes usually close to 1.236 Fibonacci extension of A related to B, but sometimes it could go up to 1.618 fibs ext.
At the graphic below, we can see what Expanded Flat structure looks like.
GBPJPY 1 Hour Elliott Wave Analysis 6.15.2020.
Current view suggests GBPJPY is correcting the cycle from the 139.7 peak. Short term recovery 2 can be unfolding as irregular Flat Pattern. We expect to see 5 waves up from the recent low which would be ((c)) leg of proposed 2 red Flat recovery. The price can see approximately 135.74-136.72 area , equal legs ((a))-((b)), before sellers appear again for proposed extension down.
GBPJPY 1 Hour Elliott Wave Analysis 6.16.2020.
At this stage we can see that recovery made form of Elliott Wave Flat Structure as we expected. Waves ((a)) and ((b)) black have corrective- 3 waves structures. While wave (C) blue unfolded as 5 waves rally. Wave ((b)) ended below starting point of wave ((a)) and wave ((c)) ended above ending point of wave ((a)). The pair has already reached ((a))-((b)) equal legs at 135.74-136.72 area and giving us reaction from there. We expect further separation from the current 136.35 peak and ideally break of 06/15 low which will confirm next leg down is in progress.
You can learn more about Elliott Wave FLAT Patterns at our Free Elliott Wave Educational Web Page
GBPJPY 1 Hour Elliott Wave Analysis 6.19.2020.
Eventually the pair broke 06/15 low, confirming next leg down is in progress. The pair is now bearish against the 136.35 peak and should ideally find sellers in 3,7,11 swings against that high.
Keep in mind market is dynamic and presented view could have changed in the mean time. You can check most recent charts in the membership area of the site. Best instruments to trade are those having incomplete bullish or bearish swings sequences. We put them in Sequence Report and best among them are shown in the Live Trading Room.
Elliott Wave Forecast
