Thursday March 3, 2005 - 01:09:30 GMT
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Forex: Daily Forecast for the British Pound vs U.S. Dollar 3rd March 2005 Price:
Resistance: 1.9147 ... 1.6165 ... 1.9190 ... 1.9225
Support....: 1.9110 ... 1.9084 ... 1.9060 ... 1.9030
Cautiously, while 1.9147-65 holds we are bearish to 1.9030 at least
Loss of 1.9135-60 has given more weight to the bearish scenario. However, thus far the decline has failed to breach the 1.9060-75 pivot support and until that occurs there may be one last scenario that would allow a recovery. This would require price to move back above 1.9147 and 1.9168 which would then allow gains to extend towards 1.9190 and probably above the 1.9225 corrective high and on towards the 1.9260 high which we feel would stall if seen today. Further resistance is found at 1.9307-22.
Loss of 1.9135 looks more likely to confirm the downside. However, to be more comfortable we would like to see a move below 1.9060 and then 1.9030. Once seen losses should accelerate down through 1.8970-80 and to 1.8883 at least. While this is valid we require price to remain below 1.9147-68.
Elliott Wave Comments:
28th February 2005
We have a small conflict as we see the Pound break higher. Wave (c) = Wave (a) at 1.9220 with a 123.6% projection at around 1.9307 and 138.2% projection at 1.9400. These are all within the broad daily congestion seen on the initial decline from 1.9548 and we definitely feel that this broad area should remain intact and generate a reversal.
However, we need to fine-tune this a little better. Wave (v) in Wave (c) has a target between 1.9250 and 1.9307 and this would be our preferred target. However, we also note that the move from 1.9013 appears to have developed in a three wave move and threatens to end at 1.9220. Thus with daily cycles looking to turn lower we should be very cautious over just how far the Pound can rally and watch carefully after an expected test at 1.9220.
2nd March 2005
We can only add to Monday's comments and confirm what we feel to be the risk of a cap having been seen at 1.9260 yesterday. We have now seen a break below the uptrend line (on close) in the 4-hour chart but still require a move below the 1.9125-35 pivot support but once seen we feel there is room for acceleration lower through 1.9060 to 1.9013 and below. Indeed, the obvious target will be the 1.8751 prior Wave (b).
(c) FX-Strategy Inc 2005
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