Two days ago, on July 8th, we published an article called “GBPJPY intraday signs of weakness”. Having a clear five-wave impulse to the south, we stated that it was time for a small three-wave rally, after which the decline was expected to resume. Our opinion was based on the following chart.
On the next one you will see what has happened with GBPJPY during the two days that passed, since our forecast.
As visible, GBPJPY went up in corrective manner for wave (2)/B. Soon after, the decline we were waiting for started to unfold. This situation is an excellent example of the Elliott Wave Principle’s ability to predict more that just one single price movement.
There are two possible scenarios from now on. Since we already have the minimum of three waves to the south, we may label it as a completed zig-zag correction. If this is the correct count, we should expect higher prices from now on. The alternative count suggests for a temporary upward correction, which could only interrupt the bigger downtrend. There is no point in trying to pick “the right one” of the two counts now. It depends on the Market. The good thing is that the Wave Principle has helped us prepare for both of them.
