Tuesday March 8, 2005 - 00:57:29 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the U.S. Dollar vs Japanese Yen 8th March 2005 Price:
Resistance: 105.44 ... 105.60 ... 105.86 ... 106.49
Support....: 105.00 ... 104.65 ... 104.40 ... 104.10
Slightly mixed and we do anticipate a move down to the 104.40-70 area again - but need to exercise care in case we see a move to 105.55-60 first
Price rallied as expected yesterday reaching as high as 105.36. We now see two potential scenarios. The first is a third attempt at 105.45-60 followed by a drop to 104.70 while the second is a direct drop to 104.40-70 which should then see resumption of the larger uptrend. Below 105.00 signals the latter and above 105.24 suggests the former. A direct break above 105.60 triggers immediate follow-through to 105.86 and probably higher to the 106.49-84 area.
The 104.31 has held after all. While we do prefer a larger bullish scenario, any direct move to the 105.44-60 area would appear to provide a short term selling opportunity though we'd probably not get below 104.70-00. Direct loss of 105.00 would allow a dip to 104.40-70 but we look for this to hold. Thus a stronger bearish view only becomes valid on a break of 104.30 and would then open the way for the decline to reach 103.32-61.
Elliott Wave Comments:
7th March 2005
The sharp drop from 105.56-58 does cause the wave structure to appear rather complex and therefore suggestive of a complex correction. With daily cycles now due to find a low we tend to stick with a bullish interpretation which would then imply either a flat correction from the first 105.56 high or a triangle type structure. This should imply a low has either been seen at 104.31 or we could see a dip to the 104.09 area. Once this correction completes look for gains to move above 105.60 and accelerate higher.
As a caveat - any drop below 104.00 would then imply Friday's 105.58 high was a second Wave x but we would still feel the losses implied will be minimal.
(c) FX-Strategy Inc 2005
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