Thursday August 5, 2004 - 01:17:54 GMT
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Forex: Daily Forecast for the U.S. Dollar vs Japanese Yen 5th August 2004Price 111.00
Resistance: 111.25 ... 111.40 ... 111.73 ... 111.95
Support....: 110.90 ... 110.70 ... 110.39 ... 110.15
Mixed - waiting for breaks
A direct recovery seen yesterday but failed to break above the 111.65-70 resistance and this does raise warning signals. We need to see the 110.70-90 support zone hold today if we are to see continued gains. Should this area hold and we see a move back above 111.25-40 we would feel more comfortable in looking for continued gains above 111.73 and onto 112.46 and probably the 113.00-30 resistance area.
Failure to break above the 111.65-70 resistance keeps a bearish stance valid. However, we first need to see a break of the 110.70-90 Fibonacci support area and once below we would expect an attack on the 110.39 low and on the 110.20-30 pivot support. This may provide a temporary pullback but we would expect break and a move to 109.60-65 at least and on any aggressive move a target around 108.40 is quite attainable.
Elliott Wave Comments:
August 2nd 2004
This week could prove erratic and complex. It now appears that Wave (iii) ended at 112.46, lower than the ideal 113.00 target. Thus we are seeing the development of Wave (iv) that has Fibonacci retracement support at 110.80 - being 38.2% of Wave (iii) - and at 110.20-30 - being 50% of Wave (iii).
Given the mixed cyclic pressure with the yellow cycle beginning to rise again we feel that a flat correction or expanded flat is likely and in line with the guideline of alternation. We therefore suspect that we will see an expanded flat which has a target at 113.00-10 which would allow price to test the original target for Wave (iii) but would then cause a second decline back to the 110.75-80 area.
Clearly a break below 110.20 would threaten the entire scenario and would have to re-assess the entire wave structure of the rally.
August 4th 2004
Having completed the long term analysis yesterday we are beginning to doubt the current wave count detailed below. We will leave this for a day or so to watch price development but there is a scenario that calls for the low at 106.99 to be Wave (a) of a larger triangle, the peak at 112.46 as Wave (b) and we are now seeing Wave (c) that would target the 107.60-108.20 area.
(c) FX-Strategy Inc 2004
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