Wednesday January 5, 2005 - 01:36:27 GMT
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Forex: Daily Forecast for the British Pound vs U.s. Dollar 5th January 2005 Price:
Resistance: 1.8859 ... 1.8895 ... 1.8915 ... 1.8940
Support....: 1.8805 ... 1.8770 ... 1.8740 ... 1.8708
Mixed - waiting for breaks
Break of 1.8981 has generated fruther aggressive losses and we do not consider the downside risk as complete just yet. Any intermediate bullish opportunities will require a break above 1.8895-1.8915 and only if seen would allow gains to proceed towards the next resistance at 1.8940 at least and probably the 1.8975-80 area but we will expect that to cap. Futher resistance is found at 1.9012.
Losses moved not only below 1.8981 but also below 1.8860 to reach 1.8780 and we feel the underlying move still have further downside to be seen. For any direct losses to be valid we need to see the 1.8895 area cap and for a break below 1.8805-15 which would then imply losses should reach the next support at 1.8740 and possibly 1.8708. Overall the prospect appears to be for a move as low as 1.8645 which is expected to support. Any initial rally to 1.8975-80 should provide an excellent selling opportunity.
Elliott Wave Comments:
5th January 2005
Loss of 1.8981 suggests we should now see Wave -iv- decline to the 1.8645 area representing a 50% retracement of the Wave -iii- rally from 1.7744 to 1.9548. The decline is either developing in a rather stretched ABC pattern or within a triple three. We favor the latter which should keep the rertacement in a second Wave x below 1.8981 and 1.9054-67 to allow a third ABC pattern down to target.
(c) FX-Strategy Inc 2005
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