Wednesday September 1, 2004 - 00:20:53 GMT
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Forex: Daily Forecast for the Euro vs U.S. Dollar 1st September 2004 Price: 1.2180
Resistance: 1.2195 ... 1.2230 ... 1.2270 ... 1.2300
Support....: 1.2160 ... 1.2140 ... 1.2120 ... 1.2100
Higher to 1.2225-35 from where a pullback is likely
We have seen price break higher as expected and has reached just above the 1.2175-85 resistance detailed yesterday. The current consolidation should remain above 1.2160 and provoke a rally up to 1.2225-35 where we expect a pullback. Thus only above 1.2140 would imply direct gains to the stronger 1.2280-00 resistance area.
With the break higher the upside looks more inviting. However, we do see a selling opportunity on a rally to 1.2225-35 from where we look for a correction back towards the 1.2130-60 support. Only a direct loss of 1.2140 would concern and suggest a retest of the 1.2100 corrective low. Next support is at 1.2070.
Elliott Wave Comments:
30th August 2004
The drop from 1.2385 has now almost reached the 1.1967 low and in conjunction with the cyclic picture there appears to be few wave structures open to us. If indeed this decline is part of a correction from 1.1967 then the 1.1960-00 area should provide a base. If price rallies directly today from 1.2000 we may just still be able to argue a triangle pattern that would allow a lift to 1.2280-00. Indeed, this would be preferable since a drop to 1.1960-70 in a flat correction would imply a rally all the way back to 1.2385 which is difficult to consider right now - though not impossible within the 2 week bullish cyclic picture.
The alternative we need to consider is that the peak at 1.2385 actually formed the Wave B peak and this decline could then reach wave equality of Wave A at 1.1890 to form Wave [i] of a larger decline. From this low we would then expect a Wave [ii] correction over the next two weeks of bullish cycles before the larger decline should develop. Thus a little flexibility is required to establish exactly what we are looking at but this should become apparent early this week.
(c) FX-Strategy Inc 2004
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