Friday August 27, 2004 - 01:11:03 GMT
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FX-Strategy - www.fx-strategy.com
Forex: Daily forecast for the U.S. Dollar vs Japanese Yen August 27th 2004Price 109.65
Resistance: 109.80 ... 110.00 ... 110.15 ... 110.45
Support....: 109.40 ... 109.15 ... 108.95 ... 108.55
We remain bearish but look for 108.90-109.10 to stall the decline
A bullish stance is not favored overall but we do feel the decline from 110.48 so far suggests that price could remain quite choppy and thus provide some short corrections higher. We do feel that any initial test of the 108.90-109.10 area could provide a pullback and can identify resistance levels at 109.60-80 which have a chance of holding. Further pivot resistance lies around 110.00. Thus a stronger bullish stance would require a move back above 110.00-15 in which case the 110.48 high should be revisited and possibly the 110.85-00 area.
We are basically bearish but recognize the chances are high of price being choppy today. We tend to favor a direct move lower from current levels that should target the 108.90-109.10 area but consider that as a base for a pullback. Thus only a move through 108.90 would imply losses down to 108.50-60 before higher. Alternatively, any test of 109.60-00 would appear to provide a good selling opportunity with stops above 110.20.
Elliott Wave Comments:
August 23rd 2004
Although having broken the ideal target at 109.05-10 slightly we are still in favor of the 108.90 low having formed a Wave c low and with intermediate daily cycles suggesting 3-5 days of recovery we anticpated the development of a Wave x ahead of further losses in a second ABC pattern lower. Logical resistance for the Wave x is at 110.25 being a 1.618 projection of the first rally from 108.90 to 109.75 and at 110.85-00 being the area of the Wave b peak.
August 26th 2004
We feel the 110.50 high yesterday completed a Triple Three correction in Wave x and this should allow a further ABC pattern to develop lower. At this point it is impossible to know where the first Wave (a) will end though we can point to two levels that seemed favored - these being at 108.55 and 108.10. We tend to prefer the higher area which should then prompt a Wave (b) and finally a drop to the 107.60 target in Wave (c) some time next week.
(c) FX-Strategy Inc 2004
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