Wednesday August 3, 2005 - 01:13:58 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the Euro vs U.S. Dollar 3rd August 2005 Price:
Resistance: 1.2214 ... 1.2236 ... 1.2255 ... 1.2283
Support....: 1.2176 ... 1.2142 ... 1.2100 ... 1.2069
Mixed - waiting for breaks
Still no break of the 1.2250-55 area and while we can fit a corrective wave structure to yesterday's move we do also note the breach of the supporting trend line (on close) which appears to hang over price. Thus for any bullish stance we require the 1.2142-74 area to support and then for a break back above the 1.2250-55 area. If seen then the move to the 1.2353 area becomes more likely. Intermediate resistance is at 1.2283-1.2315
Failure to break above 1.2250-55 concerns and with the breach of a supporting trend line (on close) we are a little concerned about the anticipated bullish stance. We certainly feel that a move back to 1.2142-74 is likely. However, before getting too bearish we require a break of the lower level which would then signal a pullback to the rally from 1.1963-1.2250. This should provide losses to 1.2064-74 and to 1.2020-30 at least.
Elliott Wave Comments:
2nd August 2005
Wave iii reached a little higher than the 1.2231 target, stalling at the 1.2250-55 peaks for a third time. Thus we look for Wave iv to develop and will expect this to remain above the 38.2% & 50% retracement levels at 1.2167 & 1.2142 respectively. From this next low look for a three wave move higher in Wave v would reach the 1.2353 target area and would form Wave (a) of a new ABC pattern higher.
3rd August 2005
Yesterday's peak at 1.2250 could be counted as Wave b of Wave iv and thus the 50% pullback level at 1.2142 should hold and cause a move higher in Wave v towards the 1.2353 area as suggested yesterday. However, given the break of the trend support on close (as detailed in the intraday analysis) we have to be a little cautious and if seen then we have to label yesterday's high as the end of a truncated Wave v (and thus the end of a new Wave -a-) This would then imply that we are seeing Wave -b- but doubt this will move below the 61.8% retracement in the 1.2064 area and at most the 76.4% rertacement at 1.2020-30. More likely we shall see a few days of tight ranging in a more complex Wave -b-.
(c) FX-Strategy Inc 2005
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