An excerpt from FX-Strategy’s Pro Commentary
[B]Bias:[/B]A little caution but while 1.3655-80 supports I suspect we’ll move higher to 1.3793-1.3816
[B]Daily Bullish:[/B]The peak at 1.3838 was rather deep but the most likely pattern for this is a triangle which has quite strong swings. This should have seen a low at 1.3640 and thus a break above 1.3712-20 should trigger gains. Watch pivot resistance at 1.3750-60 which could cause some consolidation but overall this rally should then reach the 1.3782 level at a minimum and probably 1.3793-1.3816 which should cap. Only an earlier dip below 1.3640-55 would imply a dip to 1.3570-1.3608 which should be bought. [B]MT Bullish:[/B]Cycles remain bullish for the next 2-3 weeks. Note the slowing in upward momentum which appears to be forming a triangle ahead of a test of 1.3932 and more likely 1.4016 and 1.4078 to cap. ([B]13th August[/B])[B]Daily Bearish:[/B]While I am more biased towards the upside today we should also watch a possible terminal downside pattern that would see a cap around 1.3712-20 from where a dip down below the 1.3640 low should be seen. This should mean a minimum test at the 1.3608 corrective low and more likely the 1.3570-95 area which should complete the larger correction and force a reversal higher. Thus only below 1.3570 would cause stronger losses to 1.3470-06.[B]MT Bearish:[/B]I still think we need be patient for a likely test of the 1.4016 and 1.4078 areas to establish medium term short positions. Only an earlier break below 1.3570 would bring a quicker reversal lower. ([B]13th August[/B])
[B]ELLIOTT WAVE COMMENTS[/B]
The triangle Wave (iv) appears to be the most likely scenario although we should also be aware of the alternative flat correction that would mean a move down to the 58.6% retracement in Wave (iv) at 1.3570. Also note a closer wave equality target of the initial 1.3851-1.3608 decline at 1.3595.
If this 1.3570-95 area is seen it should complete Wave (iv) and cause a move higher in Wave (a) of Wave (v) back towards the 1.3838-51 area.
More likely I feel we are seeing a triangle with the 1.3640 low being a 85.6% projection in Wave ^c. From here a move higher in Wave ^d towards the 66.7%-76.4% projection at 1.3793-1.3816 area is expected before a final Wave ^e decline.
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