Friday May 28, 2004 - 01:30:46 GMT
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FX-Strategy - www.fx-strategy.com
Forecast for USDJPY 28th May 2004Price: 110.85
Resistance: 111.10 ... 111.25 ... 111.45 ... 111.65
Support....: 110.65 ... 110.45 ... 110.15 ... 109.90
Our cautious bullish view did not get triggered yesterday with the recovery failing to move above 112.10, below the 112.25-50 trigger we had identified. Loss of 111.10-30 prompted the extension down to 110.63 where we are correcting right now. This pullback could again be quite shallow with resistance found at 111.25-45 which we favor holding. Further resistance is at 111.65.
The break of the 111.10-30 area yesterday allowed breach of the supporting trend line and does indicate further losses. Ideally we look for 111.25-45 to hold and for a drop below 110.63 to allow losses to continue towards 109.90 where we see good support - and a possible end to this decline from 114.85. Further support is at 108.70.
Elliott Wave Comment:
We are concerned with the wave count we have been following. The Fibonacci relationships have not been consistent and yesterday would imply Wave -iii- stalling at 111.24, much higher than would normally be expected. While this may be due to the rising trend line from 103.42, the proximity of the 38.2% Fibonacci retracement target at 111.10 and the Pivot support at 111.00 is a clear warning of a possible alternative wave count. The first image projects the wave count we have been following.
The second image provides an alternative wave count from the 114.85 high in the form of a Triple Three. Interestingly this holds better Fibonacci relationships and thus with the proximity of the 38.2% retracement target at 111.10 and the rising trend line we must give this alternative strong consideration. The first move would be to the Wave -b- seen at 113.30 which would destroy the original wave count - thus watch this closely.
(c) FX-Strategy Inc 2004
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