Monday June 4, 2007 - 04:30:16 GMT
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Daily Analysis for USDJPYPrice:
Resistance: 122.12 ... 122.32 ... 122.63 ... 123.17
Support: 121.80 ... 121.48 ... 121.17 ... 120.84
Continue to watch the 122.18 & 122.63 resistance levels â€“ a reversal lower does seem close
Price continued to edge higher very slowly on Friday reaching 122.12. Perhaps this has provided a peak although there are no real bearish divergences. Thus we should continue to remain open to further gains â€“ and while these are possible I note support at 121.80-85 which Iâ€™d prefer to hold. Support is also at 121.48. A move above 122.12 would probably move above 122.18 and to the 122.31-34 area where a correction is possible before a final move to 122.63-72.
The upside has extended though hasnâ€™t yet met the 122.18 high. Indeed, the shorter term wave structure does seem to suggest a test of 122.63-72 but only above there would stop a larger reversal lower. (May 31st)
I am still very cautious here as the weekly cycles are really pushing lower now and could force a sharp reversal at any time. It may mean we will see a push to 122.20 or 122.63 but we should also be aware of the key supports. First is at 121.80-85 and if this breaks it should force a sharper move lower â€“ at least to 121.48 but probably 121.17. This could cause a pullback, but if we see this decline the chances are the major peak has been seen.
Reversal lower is imminent. Below 121.50-80 tends to increase the chances that a peak has been seen else look for a move to 122.20 minimum and possibly up to 122.63-72 before finding a peak. (June 4th)
ELLIOTT WAVE COMMENTS
A minor new high has been seen in a messy wave structure and this could be said to be sufficient to mark a final high. I still prefer price edging higher but donâ€™t fight a break below the trend support at 121.60 and then the 120.84 corrective lowâ€¦
Price reached the wave equality target at 122.12 on Friday and we are therefore on a warning of a possible reversal. Back below 121.80 would heighten this risk. If seen look for the first move lower to end between Wave â€“iv- at 120.84 and Wave â€“b- at 121.17. Any bounce from 121.80-85 should reach the 161.8% projection in Wave â€“c- at 120.63-72 which is also where a daily triangle target rests.
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