Thursday January 25, 2007 - 05:23:58 GMT
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FX-Strategy - www.fx-strategy.com
Daily Analysis for EURJPYEURJPY
Resistance: 156.50 ... 156.78 ... 187.00 ... 157.20
Support: 156.07 ... 155.80 ... 155.55 ... 155.15
We watch potential support at 156.13 and 155.50-60 and a recovery from one of these areas
Price didnâ€™t quite make it to the 158.75 resistance and the decline from yesterdayâ€™s peak has been much stronger than anticipated. This will mean that we should see test lower and should watch key support around 156.07 and again at 155.50-60. We tend to favor the lower area supporting and causing a reversal higher. Thus only a direct break above 156.50 and the 157.00-20 would provide a lift for 157.40-60 which should cap for a pullback.
The pullback from 158.61 has been very deep but we suspect that support at either 156.13 or 155.50-60 will hold and allow gains to be made once again. (January 25th)
Loss of 158.30-40 has triggered much stronger losses than anticipated that have reached the 156.07 thus far. We do need to be cautious of a possible reversal higher at this point but suspect the 156.50 area should cap and allow a deeper decline to the 155.50-60 area which we feel will hold for now. Next support is at 155.15.
Having seen a move higher we remain with a bullish stance but note resistance at 158.75-00 and then at 159.77. Probably the lower area should cause a pullback but only clean break of 157 would be bearish. (January 24th)
ELLIOTT WAVE COMMENTS
The pullback from 158.61 has been sufficiently strong to suggest that we have seen the end of Wave (a) of Wave (v) and thus we should be looking for a base in Wave (b). A 50% retracement rests at 156.07-13 and a 61.8% retracement is at 155.50-60 which also represents a 138.2% projection in Wave (c) and is also where pivot support lies together with a 61.8% retracement of the move from 153.66 to 158.61. This would complete Wave (b) and let Wave (c) higher develop.
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