Wednesday September 28, 2005 - 01:20:47 GMT
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Forex: Daily Forecast for the U.S. Dollar vs Swiss Franc 28th September 2005 Price:
Resistance: 1.2950 ... 1.2977 ... 1.2995 ... 1.3024
Support....: 1.2918 ... 1.2903 ... 1.2879 ... 1.2851
The 1.2995-1.3024 resistance is crucial to the correction scenario - any breach would imply 1.3080-1.3110
Price rallied to just 5 points above the 1.2990 resistance and we must therefore consider the risk that this provided a key peak. However, the wave structure is a little unclear and while 1.2903-18 supports there is still risk of further gains. A recovery back above 1.2950-77 would produce a more robust test of 1.2995 but we need then observe resistance at 1.3024. Breach there is required to extend gains to 1.3080-1.3110.
The peak at 1.2995 is just 5 points above our target and could well turn out to be a strategic high. However, the wave structure in the recent rally has become a little ambiguous and we need to act with some caution. Only a break below 1.2903-18 would imply that a larger pullback is being seen and if so, then we'd look for a move down to the 1.2820 area which could support on first test. Further support is at 1.2762.
Elliott Wave Comments:
26th September 2005
We have seen the expected rally and this has even broken above the 1.2883-1.2902 initial target. It has confused the wave structure a little but we can now use the potential targets above as possible stalling points. The closest is at 1.2947 but we feel a move trhough to 1.2970-90 is more likely but should provide an end to the rally from 1.2236.
28th September 2005
With the 1.2990 target having been met and breached by only 5 points it is possible that this has formed the end of Wave -iii-. However, we have found the wave structure a little ambiguous and as such it would be wise to wait for confirmation. An early signal is a break below 1.2900 and if seen we'd then expect quite a deep pullback in Wave -iv- which could return to the 1.2743 level at least (being 41.4% of Wave -iii-) or to the full 50% retracement at 1.2690.
(c) FX-Strategy Inc 2005
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