Wednesday January 24, 2007 - 05:15:10 GMT
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FX-Strategy - www.fx-strategy.com
Daily Analysis for AUDUSD
Resistance: 0.7862 ... 0.7882 ... 0.7895 ... 0.7911
Support: 0.7827 ... 0.7801 ... 0.7780 ... 0.7759
Mixed â€“ waiting for breaks and suspect a sideways consolidation
While gains were seen as preferred these didnâ€™t reach the ideal targets and this morning we have seen a strong reversal lower. We note good support at 0.7827 and we feel this could well hold and cause a reversal higher. Further support is at 0.7801. To see a recovery we need a move back above 0.7862 which would encourage gains back to 0.7882 at least and probably the 0.7895-0.7911 area which we feel stands a good chance of capping. Only above revisits the 0.7936 high.
The sharp losses from below the 0.7979 target is, while 0.7801-27 supports, considered a correction and we can still see gains above 0.7979. We await price development to confirm. (January 24th)
The sharp losses seen from 0.7936 were not expected and suggests we are seeing a correction to the 0.7759-0.7936 rally. Ideally weâ€™d like to see the 0.7827 area support â€“ only if this breaks is there risk to 0.7801. We are still cautious about the downside at this time, but below 0.7800 would cause a retest of the 0.7759-80 area.
We still prefer a bullish stance for a retest of 0.7979 and possibly 0.8040. However, we would respect a breach of 0.7800 which would test and probably break the 0.7759 low for a move to 0.7614-32. (January 24th)
ELLIOTT WAVE COMMENTS
We didnâ€™t expect the 0.7936 level to cap but we now consider this as Wave [a] of Wave â€“v- and thus the current pullback is likely to be Wave [b] or the beginning of a more complex Wave [b]-.
We note a 61.8% pullback at 0.7827 with 66.67% at 0.7818 and 76.4% at 0.7801. We feel that the structure would tend to suggest that a more complex Wave [b]. Thus we await further developments before judging the likely pattern.
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