An excerpt from FX-Strategy’s Pro Commentary
Bias:Care – watch support at 113.45-80 and resistance at 114.63 and 115.17
[B]Daily Bullish:[/B]Gains seen as preferred which stalled perfectly at the 114.38 resistance. I note that momentum still looks firm with no obvious reversal signals. Therefore while there is risk of a correction to 113.80-00 – and may be 113.45-50 the implication is that we should see further gains. A bounce from 113.80-00 would target 114.63 and take care as this could cap. A bounce from 113.45-50 (max 113.22) would trigger gains back to 114.38 again but stall for a while before going higher. Next resistance is at 115.70.[B]MT Bullish:[/B]I still see cycles as bullish… However, to be more confident in the timing accuracy I’d like to see a recovery above 114.12 and 115.00 to take us back to the 116.60-117.12 area again. ([B]10th September[/B])[B]Daily Bearish:[/B]Having reached the 114.38 resistance we should be on alert for a move lower. At this point I feel it may be brief. There is support at 113.80-00 and this should be watched first for signs of a reversal higher. If this breaks then a deeper pullback is possible to 113.45-50 and max 113.22-26 but then still retain a MT bullish structure. Thus a stronger bearish stance is going to need a break below 113.20 in which case we should see a move back towards the 112.58 low. [B]MT Bearish:[/B]Loss of 113.32 has surprised but I still want to be cautious about strong losses. There is support at 112.06-30 – below there targets 111.29-57 – if this breaks then 108.75-109.36 is implied. ([B]10th September[/B])
[B]ELLIOTT WAVE COMMENTS[/B]
While it is difficult to fit in the labeling on the chart I thought I counted a third ABC pattern lower and if so this has completed a Triple-Three and risks a rally back higher in Wave (a) of Wave (iii).
Best also to keep in mind the counter view, which if by any chance the 117.12 high was actually a Wave (iv) then a 61.8% projection is at 109.36 and a 66.7% projection is at 108.75. This would of course require a Wave (a) down to around 111.57 followed by a correction in Wave (b) before declining to target.
Within this counter view we would need a break above the 50% retracement at 114.85 to lower the chances of this pattern developing.
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