Elliott Wave Analysis: GBPUSD and USDCAD
GBPUSD is moving down, nicely away from our Fibonacci resistance area at 1.0950 that was highlighted last week as important zone for wave 5 of 3). Notice that current leg down now also fell below 1.2889 support of wave four which suggests that highs are in and that pullback of a higher degree wave 4) is here so be aware of more weakness, possibly even to 1.2770.
USDCAD is trading higher, but price structure is slow and choppy so we see it as final piece of a higher degree wave 5. Also, this can be an ending diagonal in wave 5 that suggests a change in trend this week.
The ending diagonal is a special type of motive wave that occurs primarily in the wave 5 position when price has moved too far and too fast. Some ending diagonal triangles appear in the C wave of an ABC correction. In all cases, the ending diagonal terminates the move of larger patterns. They consist out of five waves, with each having three more sub-waves.
Basic Ending Diagonal:
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