Friday November 4, 2005 - 01:07:10 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the Euro vs U.S. Dollar 4th November 2005 Price:
Resistance: 1.1951 ... 1.1980 ... 1.2017 ... 1.2045
Support....: 1.1910 ... 1.1874 ... 1.1830 ... 1.1801
Look for an initial decline to 1.1905-10 and while any pullback remains below 1.1970-90 for a further drop to 1.1874
Price declined perfectly in line with expectations and we feel this strengthens the bearish view. Early trading should see a move down to 1.1905-10 but we feel this should provide a short term buying opportunity for a recovery to 1.1950 at least and probably the 1.1970-90 area which we feel should cap. A later test of 1.1874 is then expected and should provide a better buying opportunity for a larger pullback. Only a breach of 1.1990 would see direct gains back to 1.2045.
Losses developed as suggested and should continue today. Early trading should test the 1.1905-10 area but look for a pullback from there. Sell any retracement to 1.1960 with stops placed above 1.2000 then look for a test of the 1.1864-74 lows and take profit as we anticipate a larger pullback. Only directly below 1.1864 would allow losses to continue towards 1.1801 and 1.1750-60.
Elliott Wave Comments:
3rd November 2005
Retracement target met and we now label the 1.2084 high as Wave -ii- and thus can derive targets for Wave -iii-. We note the following relationships:
Wave -iii- = 138.2% projection of Wave -i- at 1.1801
Wave -iii- = 161.8% projection of Wave -i- at 1.1752
Wave -iii- = 261.8% projection of Wave -i- at 1.1547
The 161.8% target rests around the last major weekly low at 1.1758 while we should also keep in mind the larger target at 1.1458-74 which could mean that an aggressive decline could reach 1.1547. We shall observe as price declines.
4th November 2005
Wave -ii- is now confirmed at 1.2084 and the decline from there is developing in five waves which is expected to reach the 1.1874 area later today. This will form Wave -a- of Wave -iii- and thus imply a pullback to the 1.1950-80 area in Wave -b- before Wave -c- moves lower to 1.1752 at least and we suspect lower.
(c) FX-Strategy Inc 2005
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