Thursday August 4, 2005 - 00:55:46 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the Euro vs U.S. Dollar 4th August 2005 Price:
Resistance: 1.2360 ... 1.2390 ... 1.2420 ... 1.2446
Support....: 1.2298 ... 1.2250 ... 1.2222 ... 1.2197
Cautiously we look for 1.2353-66 to cap and for losses over the day
The 1.2142-74 area provided good support yesterday and has generated a move up to 1.2342 thus far. This may have provided the top though we should allow for 1.2353-66 which we feel is the limit to the upside. Thus a stronger bullish stance requires a move above 1.2370 which would then suggest direct follow-through to 1.2446 at least and possibly 1.2460-81.
With the move higher to 1.2342 we feel the rally from 1.1962 is complete or close to completion. Thus we feel 1.2353-66 is the maximum upside we should see today and current levels provide an excellent selling opportunity with stops above 1.2370. First support is around the 1.2296-00 corrective low and then the 1.2250 pivot support which should provide a pullback. Further support found at 1.2222.
Elliott Wave Comments:
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-.
4th August 2005
The test higher yesterday should have completed (or almost completed) the Wave v to complete the next Wave (a) higher. We now look for a retracement in Wave (b) before the final move to our 1.2460-00 target area. Levels to watch on the way down are at the 1.2250 pivot support and then a 38.2% retracement at 1.2197 and the 50% retracement at the 1.2148-52 corrective low. At the most we see a deeper pullback to 1.2107-19 which represents a 58.6%-61.8% retracement. However, given this is a Wave (b) we must remember the liklihood of this developing in a choppy Triple Three and will most likely be very erratic.
(c) FX-Strategy Inc 2005
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