Friday March 4, 2005 - 00:44:08 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the British Pound vs U.S. Dollar 4th March 2005 Price:
Resistance: 1.9080 ... 1.9100 ... 1.9125 ... 1.9160
Support....: 1.9055 ... 1.9032 ... 1.9013 ... 1.8975
Cautiously, We still look for a dip to 1.9030-35 but followed by a recovery to 1.9060 and 1.9100-25
Price held below the 1.9147 resistance and has seen further choppy losses. We see these continuing first thing but feel these should stall at the 1.9030-35 support and consider this a good buying opportunity. From there we look for a return to 1.9060 and once this breaks further to the 1.9100-25 area which we feel should hold. Thus only back above 1.9125 and 1.9142 would cause a stronger pullback higher with next resistance then seen at 1.9160 followed by 1.9225.
The move lower has been slower than anticipated but while 1.9080 holds we look for the decline to reach the 1.9030-35 level but feel this should hold on the day. Thus a stronger bearish view is only valid on a break below 1.9030 and woudl then cause a sharper decline to the 1.8970-80 support and possibly 1.8930 which stands a chance of seeing a pullback.
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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