Wednesday December 13, 2006 - 05:07:12 GMT
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Daily Analysis for GBPUSD
Resistance: 1.9726 ... 1.9750 ... 1.9775 ... 1.9815
Support: 1.9680 ... 1.9658 ... 1.9620 ... 1.9600
We look for a peak in the 1.9726-58 area and for a pullback from there
After the test of 1.9632-49 we saw the rally continue into the 1.9700-26 range and we sense the rally is not complete. We do need to be aware of an initial pullback towards 1.9653-63 but while that area supports we feel the upside can follow-through towards the 1.9726-58 area which we feel will spark a further pullback. Only above 1.9758-75 congestion zone would extend the rally further to 1.9810-20.
We have now seen a larger correction and this should be sufficient. While 1.9425-47 supports we look for a return above 1.9580 and to 1.9650 and the 1.9726 corrective high at least. (December 11th)
The upside still looks intact and while there is a suggestion we should see an initial pullback towards the 1.9653-63 area we would only really get more bearish if we see a break of this support. If seen then the downside should extend to the 1.9575-00 area which should hold. Further support is found at 1.9560.
We feel the move down to 1.9464 (max 1.9415-25) will be enough to imply a sideways trading range for a while. The 1.9426 corrective high area should provide the initial resistance. (December 11th)
ELLIOTT WAVE COMMENTS
We now label the 1.9464 low as Wave iv and thus we look for gains. The limited move seen thus far may well mean that the upside is limited to the 1.9726 and then 1.9750-75 area within a triangle but it depends how this move develops. Above there would imply a retest towards 1.9746 in Wave â€“a- of Wave â€“v- before lower again in Wave â€“b-.
We feel this rally is beginning to look like it should develop in a 5-wave pattern to the 1.9846 peak again. First a Wave iii is expected around 1.9726-58 to be followed by a Wave iv before the test higher.
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