Wednesday October 19, 2005 - 00:50:40 GMT
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Forex: Daily Forecast for the Euro vs U.S. Dollar 19th October 2005 Price:
Resistance: 1.1988 ... 1.2009 ... 1.2042 ... 1.2062
Support....: 1.1907 ... 1.1881 ... 1.1864 ... 1.1827
We look for 1.1977-88 to cap and for losses to 1.1899 and later to 1.1827
Losses seen as anticipated and we feel the pullback from 1.1914 is probably complete - though we should allow for 1.1977-88. Thus only a break above 1.1990 would begin to make the picture look a little more bullish and should then imply a move back to 1.2042-62 at least where a pullback is possible. Next resistance is then at 1.2121-34.
Price fell short of our 1.1905-10 target by 4 points but we feel the pullback may well be over though we should allow for 1.1977-88. The decline should reach 1.1899 where a small pullback is possible but we shall expect a test of the 1.1827 target by end of day and tentatively look for this to provide a low. We also see a target at 1.1783 but tend to consider that the 1.1827 area is more likely to hold.
Elliott Wave Comments:
18th October 2005
The break lower does appear to suggest an expanded flat correction from 1.1899 and thus we label yesterday's high at 1.2121 as Wave b of Wave -b- and thus we should now see the development of Wave c to the 1.1820-30 area at least (max 1.1783) to complete Wave -b- and allow a rally higher in Wave -c-.
19th October 2005
The decline looks on track to reach 1.1827 and possibly 1.1783 in Wave c of Wave -b- to complete the expanded flat correction. The only small risk we see to this occurring is in timing rather than whether it will happen. With yesterday's low at 1.1914 we need consider the risk that Wave b of Wave -b- is actually developing in a flat and thus any move back above 1.1988 would confirm this scenario. This would imply a move back to 1.2121-34 to complete Wave b and then we'd look for Wave c lower in the same structure and target between 1.1783-1.1827. However, once achieved the implication will be for a recovery back to 1.2203-44.
(c) FX-Strategy Inc 2005
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