Friday May 11, 2007 - 05:14:42 GMT
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Daily Analysis for GBPUSDPrice:
Resistance: 1.9812 ... 1.9830 ... 1.9848 ... 1.9862
Support: 1.9765 ... 1.9738 ... 1.9707 ... 1.9676
Mixed â€“ waiting for breaks
The 1.9973 resistance was not even tested and loss of 1.9900 triggering strong follow-through below the 1.9841 low and onto the 1.9765 support. I do see risk of a direct recovery from here but Iâ€™d prefer to wait for confirmation of a correction. This would require a move above 1.3827-32. If seen then look for additional gains to 1.9848 minimum and possibly as high as 1.9862-82 which should cap. Only above causes a stronger reversal higher for 1.9961-97 again.
The 1.9974 high was broken but not by too much and we are left requiring a move back above 1.9997-2.0030 to extend to 2.0131 and above. (May 10th)
The losses down to 1.9765 are encouraging and in the larger picture do not complete the downside. The question in my mind is whether we see direct losses or whether we see a slightly larger correction first. While 1.9827-32 caps the downside can continue directly with loss of 1.9765 seeing losses to 1.9738 at least with loss there confirming extension to 1.9676 which I think will hold for a larger correction.
If we are to retain a bearish structure here then we need a quick break back below 1.9900 and then 1.9841 to keep the downside pressure intact for 1.9765 and possibly to 1.9676. Support also at 1.9622. (May 10th)
ELLIOTT WAVE COMMENTS
The decline in Wave c has equaled that of Wave a at 1.9765. What is not too clear form the structure of that decline is whether it has completed 5 waves. I think not and therefore the risk is still for a move to the 138.2% projection at 1.9676. This means we should see too much of a correction. The downside could occur directly if 1.9827-32 caps but we note a possibly 41.4% correction in a minor Wave iv at 1.9848 and a 50% at 1.9865.
Look to sell into any correction but take profit around 1.9676.
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