Sunday February 27, 2005 - 06:48:09 GMT
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Forex: Daily Forecast for the Euro vs U.S. Dollar 28th February 2005 Price:
Resistance: 1.3245 ... 1.3268 ... 1.3290 ... 1.3308
Support....: 1.3223 ... 1.3202 ... 1.3176 ... 1.3145
We look for 1.3202-12 to support for a rally to the 1.3290-1.3308 area before correcting
Price failed to reach the favored 1.3080-90 support area and reversed higher from 1.3145 and is close to the 1.3273 high. Indeed, while the first reaction on Monday open should be for a small correction we see the 1.3202-12 area supporting and for gains to continue above 1.3245 and 1.3270 and onto the 1.3290-1.3308 area which we feel should provide a cap for the day. Thus, only above 1.3315 would signal continued gains towards 1.3354 and possibly the 1.3386 pivot resistance.
The decline stalled at 1.3145 on Friday and the emphasis appears to have returned to the upside as expected. However, we see potential for some downside trades today and one should occur soon after open. While 1.3245 continues to hold we feel that a quick move lower to 1.3212 at least and possibly 1.3202 but we would then look for further gains. Any test later in the day to the 1.3290-1.3308 area should provide a good selling opportunity with stops above 1.3320 for a move that is expected to move back down to the 1.3245-70 area at least while we would expect an eventual move to the 1.3175-1.3210 area but this may take until tomorrow. Only a direct loss of 1.3200 and then 1.3145 would see earlier strong losses down to 1.3075.
Elliott Wave Comments:
24th February 2005
It looks like the second Wave c ended at 1.3273 and thus any decline from here risks a complete reversal although we still tend to favor the scenario calling for the dip to be Wave X which should be followed by a move to target. Only below the 1.3090 pivot support and also the 50% retracement of the 1.2844-1.3273 move at 1.3059 would signal stronger losses.
28th February 2005
The decline on Friday stalled at 1.3145 and this either formed Wave -i- of a decline or the expected Wave x. We tend to suspect the latter and should imply one last ABC pattern higher to complete a Triple Three and from that peak we would expect a larger reversal. With cycles looking to find a peak by the end of this week we feel that we need focus attention on the pivot resistance at 1.3386 and a 76.4% retracement of the 1.3666-1.2730 decline which rests at 1.3445.
Only an earlier break below 1.3145 and the 1.3080-90 pivot support would imply a sharp loss to the last Wave b low at 1.2957 which should hold for a while being within a large congestion area in the initial decline from 1.3666.
(c) FX-Strategy Inc 2005
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