Monday November 20, 2006 - 05:38:20 GMT
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FX-Strategy - www.fx-strategy.com
Daily forecast for EURUSDEURUSD
Resistance: 1.2845 ... 1.2870 ... 1.2902 ... 1.2938
Support: 1.2805 ... 1.2790 ... 1.2760 ... 1.2745
Look for an initial test of 1.2863-75 & while the pullback remains above 1.2790-00 we remain bullish
It was disappointing that the correction did not meet our favored 1.2693-1.2745 target but the reversal higher on Friday appears to have broken the sequence of lower highs and thus we should see strength over time. Today should see 1.2790-05 support and test the 1.2863-75 area (max 1.2902) which should be followed by a correction lower. Any earlier breach of 1.2902 would provide a stronger bullish structure and extension of gains to 1.2938-76 at least.
The reversal higher on Friday appears to confirm the uptrend and while 1.2790-05 supports we shall look for gains above 1.2976 and onto 1.3180 at least and we suspect higher. (November 20th)
Failure to break below 1.2760 disappointed but does appear to complete the downside correction. Thus we advise caution on any bearish stance. There is support at 1.2790-05 which we feel should hold. Only a break below would trigger additional losses down to 1.2745-60 which should be watched carefully. The 1.2693 support also remains as important.
Fridayâ€™s recovery appears to suggest the downside correction is complete and thus only back below 1.2760 would raise the risk of 1.2745 and probably 1.2693. (November 20th)
ELLIOTT WAVE COMMENTS
Still no break of key support or resistance but we do feel that a key low is not very far away. Favored support is at 1.2693-1.2745 being the 38.2% and 50% retracements in Wave B. Any earlier break above the 1.2840 level would break the sequence of lower highs and trigger a return to the 1.2894-34 area being 161.8% % 223.6% projections of a small possible Wave iii.
We feel the decline to 1.2760 has completed a triple three and thus we label the 1.2760 low as Wave B. This should see a move to just under the 1.2902 high in Wave â€“a- followed by a pullback in Wave â€“b- that should remain above the 1.2790-05 area to allow Wave â€“c- to develop.
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