Thursday February 17, 2005 - 01:08:51 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the U.S. Dollar vs Swiss Franc 17th February 2005 Price:
Resistance: 1.1883 ... 1.1922 ... 1.1945 ... 1.1963
Support....: 1.1849 ... 1.1804 ... 1.1775 ... 1.1747
Slightly mixed - though still prefer a bullish stance
Price dipped marginally below our 1.1840 support yesterday and given the bullish divergences we feel there is a good case for the resumption of the upside. However, the dip from the peak at 1.1945 does concern and we need to treat a bullish stance with caution until we get a further test higher. First resistance is at 1.1883 which we have tested already this morning and breach should be an early sign of continued strength. This should bring with it a move above next resistance at 1.1922 and then above 1.1945 to 1.1960 at least. This does hold a risk of holding. Thus only above 1.1963 would extend gains more robustly towards the 1.2033-35 pivot resistance area.
The recovery from 1.1831 looks positive - but then the move back lower from 1.1945 has been deep and does raise the risk of further downside. For this to occur we require the 1.1883 corrective peak seen this morning to hold and a dip below 1.1849 which would trigger losses down to 1.1831 at least and we suspect to the 1.1804 area where a pullback is possible. Further support is seen at 1.1773-78 and 1.1740..
Elliott Wave Comments:
16th February 2005
The drop below 1.1940 negates the scenario calling for the 1.2262 peak to be Wave (a) of Wave (iii) and now labels the 1.2262 peak as Wave (i). This implies a deeper pullback with the 1.1874-88 area being supportinve and also the 1.1747-78 area which represents an approximate 50% retracement. We feel that the decline from 1.2262 has developed in a double zig-zag and therefore only above the intervening Wave -b- around 1.1997-00 would avoid the development of a triple three. Therefore we need to be a little cautious but if we see that final ABC pattern lower it should provide an excellent buying opportunity.
17th February 2005
We feel that the decline yesterday occurred in three waves and thus suggests the risk that a triple three is complete. However, we cannot ignore the decline from the 1.1945 peak which has been equally strong as the rally from 1.1831. However, if the downside is to continue then the first 5 wave move should end around 1.1804 and we still see significant support around 1.1747-78. To confirm recovery higher we need a break still of 1.1963 and the 1.2000 area.
(c) FX-Strategy Inc 2005
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