Tuesday July 3, 2007 - 05:11:12 GMT
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Daily Analysis for GBPUSDPrice:
Resistance: 2.0183 ... 2.0199 ... 2.0233 ... 2.0253
Support: 2.0159 ... 2.0128 ... 2.0090 ... 2.0067
Cautiously I feel the 2.0183-99 area should cause a pullback before further gains towards 2.0253
The picture here is slightly different to the Euro and Swissie. However, I still see potential for a cap to develop between 2.0182-99 initially. This should lead to losses to around 2.0070-90 and this looks to be a good buying area for the next leg higher to 2.0253-87. Only an earlier break above 2.0200 would see this target attacked directly. Next major resistance is found at 2.0333.
Indeed, direct gains were seen which pushed above the 2.0131 high and this should see a move to 2.0333 initially. This should cause a correction before gains to the final target at 2.0505 (max 2.0569.) (July 3rd)
The strong follow-through is pushing higher limits and any decline should be a correction only. Indeed, watch the 2.0183-99 resistance area which I feel should cap. A move from here below 2.0150-60 would cause a move back to the 2.0070-90 area but I suspect this will hold. Thus a stronger bearish stance will require a break below 2.0070 and then 2.0042. If seen it should extend the downside towards 2.0000-15 at least.
The Pound seems to be on course for the 2.0505 target. Therefore only an earlier break below 2.0042-70 would begin to cause concern. A move then below 2.0000 would see 1.9927 and probably lower. (July 3rd)
ELLIOTT WAVE COMMENTS
Continued gains with very little pullback make this really hard to identify the wave structure. The overall expectation is for gains to eventually reach 2.0500. However, quite where we are within that rally is unclear. The only possible structure I feel that warrants notice is the possibility that 2.0015 was a Wave iii and thus a minimum Wave v target would imply gains to 2.0182 at least and possibly 2.0228. However, this needs further evaluation.
The direct break higher to the 2.0182 resistance mentioned yesterday has occurred but this still seems to be only part of Wave (c) of Wave (iii) which has a 423.6% projection at 2.0333. Wave (c) will equal Wave (a) at 2.0287. This broad area should see the Wave (iii) peak.
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