Sunday December 5, 2004 - 17:18:50 GMT
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Forex: Daily Forecast for the U.S Dollar vs Swiss Franc 6th December 2004 Price: ... 1.1303
Resistance: 1.1322 ... 1.1350 ... 1.1386 ... 1.1422
Support....: 1.1280 ... 1.1268 ... 1.1214 ... 1.1183
Mixed - awaiting the first move on Monday's open
The failure to move above the 1.1557 resistance on Friday looks bearish. However, at this point we need to watch the reaction on Monday's open with the 1.1299 level quite critical. While the first move on Monday holds above 1.1280 we should expect a recovery to occur. If the open sees a direct pullback higher from 1.1299 then while the 1.1322-34 area holds we see potential for a dip to the 1.1280 area - possibly 1.1268 from where we expect a recovery again which we feel could rally as high as 1.1386-1.1419.
The break of 1.1450 indeed brought further substantial losses to marginal new lows at 1.1299 and does suggest further losses to come. However, before getting too bearish at this point we need to watch the reaction on Monday's open. Any decline that directly breaks the 1.1268-80 area would allow losses to move down to the 1.1183-97 area which would then be expected to generate a larger correction higher. Further support is not found until 1.1086-95.
Elliott Wave Comments:
December 6th 2004
The failure at 1.1557 provides us with a slight conundrum in that the correction from 1.1322 occurred as a Double zig-zag and cannot be viewed as the Wave c of an expanded flat correction. This would actually suggest that the 1.1322 low was the end of a daily Wave -iii- lower and that 1.1557 completed Wave -iv-. However, this in itself is quite unusual since it would imply that the move from 1.1322 to 1.1557 was actually the full extent of the correction to the decline from 1.2682 which seems much too brief. We should be aware of the chance of an expanded flat correction within Wave -iv- which would see support at 1.1268 (max 1.1232) and a second test of the 1.1557 area. But that would be the extent of the move. Otherwise this wave count has fairly direct bearish implications. Given the brief nature of the move to 1.1557 we therefore do need to be a little cautious and watch key support areas at 1.1232-67 and 1.1183-97 but much below that and the historic 1.1100 low looks quite bearish.
(c) FX-Strategy Inc 2004
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