Friday December 22, 2006 - 05:30:54 GMT
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USDCHF - Analysis for the coming week
Today's analysis is intended to cover the coming week. The next update will be on the 2nd January. May I wish all readers an enjoyable holiday season and a peaceful, healthy & prosperous 2007.
Resistance: 1.2182 ... 1.2207 ... 1.2230 ... 1.2267
Support: 1.2126 ... 1.2107 ... 1.2073 ... 1.2027
We need to allow for a 1.2100-1.2210 range before losses are seen towards 1.1985
A rather more erratic day than expected but holding below 1.2207 and we feel that should be a cap. However, we need to be a bit careful here as it is quite possible that we shall see both ends of the 1.2100-1.2210 range tested again. For a bullish stance we need a break above the high and if seen it would begin to argue for a retest of 1.2267 and if this breaks then 1.2336 is possible. Also note resistance at 1.2395-05.
The 1.2267 high appears to have satisfied the upside and thus only a move above here would begin to threaten the 1.2336 extension and possibly 1.2395-05 which should hold on first test. Note 1.2285 also. (December 22nd)
Not quite the day expected yesterday but the 1.2207 level remains intact. We need to allow for a few scenarios here but broadly they should all hold between the 1.2100-1.2210 range but while the high end holds we shall look for a break of the 1.2100 pivot support which would trigger losses to 1.1985 at least which should cause a temporary pullback before a retest of the 1.1878 low.
We retain a broad bearish stance that should eventually retest the area of the 1.1878 low which should cause a pullback before further losses to around 1.1710-30 approximately. (December 22nd)
ELLIOTT WAVE COMMENTS
We cautiously count the 1.2110 low as Wave I of a new Wave (a) lower. A 61.8% retracement is at 1.2207 and yesterdayâ€™s 1.2192 peak may have satisfied this as Wave ii. Thus we can expect Wave iii to develop with Wave a back to the 1.2100-10 area followed by breach for a 138.2% projection at 1.1970-75.
With yesterdayâ€™s move we feel there is now a stronger risk of a complex correction and tend to favor a flat between 1.2100-1.2210. While this caps look for eventual loss in Wave iii down to the 138.2% projection that lies around 1.1975-85. This should spurn a correction in Wave iv before lower.
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