Monday July 19, 2004 - 23:12:47 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily Forecast for the Euro vs U.S. Dollar July 20th 2004Price 1.2440
Resistance: 1.2445 ... 1.2460 ... 1.2500 ... 1.2520
Support....: 1.2425 ... 1.2400 ... 1.2375 ... 1.2340
Cautiously holding above 1.2375 to reach the 1.2530-50 target
Price failed to see any further highs yesterday and has dipped below the 1.2415 support we had anticipated would hold. However, we suspect that the 1.2398 low may well prove to be the retracement low but we would prefere to wait for a break back above 1.2445 and then 1.2460 to confirm further gains to the ideal 1.2530-50 target area. However, we still see this as a cap.
Price did break below our ideal support at 1.2415 but has not yet broken below the critical 1.2380-00 area. Indeed this still remains key and only below 1.2375 would cause us to consider that the 1.2460 may well have provide the final peak to this entire correction higher. Break of 1.2375 would threaten the 1.2300 corerctiv elow and probably 1.2265.
Elliott Wave Comments
Although we had begun to think we had seen the start of the move lower last week, the failure to move below 1.2265-00 caused us to re-evaluate the shorter wave count and label the rally to 1.2425 as Wave a and the low last week at 1.2300 as Wave b. This has generated a cluster of measurements that target the 1.2540-50 area as a probable peak, least of all that 1.2540 represents a Wave [v] projection of 76.4% which also matches the 261.8% projection of Wave (c).
Thus on a move below Wave b at 1.2300 and then the Wave [iv] at 1.2265 would imply a logical move down to the Wave (b) area at 1.1975. This would break the weekly support line and any correction from there should be stunted followed by stronger losses.
(c) FX-Strategy Inc 2004
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