Sunday January 2, 2005 - 13:23:11 GMT
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Forex: Daily Forecast for the U.S. Dollar vs Swiss Franc 3rd January 2005 Price:
Resistance: 1.1436 ... 1.1452 ... 1.1483 ... 1.1530
Support....: 1.1388 ... 1.1350 ... 1.1320 ... 1.1283
We look for an initial range between 1.1385 - 1.1436 with a risk later to 1.1448-52
The decision to wait for breaks on Friday proved wiser with late trading seeing a strong break higher. However, we do not envisage this will move much higher than 1.1452 - at the most 1.1483 - and thus a stronger bullish stance will require a break of the higher resistance at 1.1483 which would then imply follow-through to 1.1560 at least and possibly up to 1.1620.
We feel the recovery from 1.1283 has opened an interesting structure which we favor. This would call for any gains to stall at 1.1448-52 with allowance given to 1.1483. It could well be that we shall see a day of range trading between 1.1320-1.1452 and thus we would prefer to wait for a clean break below 1.1283 to suggest that the downside had resumed. Thus only on this break would we then look for losses down to 1.1207 at least.
Elliott Wave Comments:
3rd January 2005
We have struggled with the wave structure here with Fibonacci ratios not behaving too well. However, we are tending towards a structure that labels the drop from 1.1683 to 1.1384 as Wave (a) which is then followed by a triangle pattern in Wave (b) to 1.1534 with the drop to 1.1283 as Wave [i]. Thus we look for a recovery in Wave [ii] to the 1.1448-52 area before Wave [ii] develops. We need to see where this ends before we can generate a target for Wave [iii] but this should be in the area of the historic low at 1.1100.
The only risk we can see to this is the possibility that the 1.1283 low formed Wave -b- of a Flat correction which would then imply gains back to 1.1683.
(c) FX-Strategy Inc 2005
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