An excerpt from FX-Strategy’s Pro Commetnary
[B]Bias:[/B]While 1.3903-26 caps I still see potential down to 1.3780-00 before moving higher again
[B]Daily Bullish:[/B]The rally finally ended 4 points above the 1.3922 resistance and from there we have seen a modest reversal. Indeed, this looks as if it should extend to the 1.3780-00 area where I feel we can begin to buy again. Only a direct breach of 1.3903 and then 1.3926 would trigger earlier gains to 1.3967 – watch this area as this could cap. However, my favored target for any bullish move is the 1.4039 area which should force a much larger reversal.[B]MT Bullish:[/B]I am now looking at the potential of an expanded flat which has resistance points at 1.3967 and 1.4039. Earlier risk is for a pullback to 1.3680-1.3720 before higher. ([B]13th September[/B])[B]Daily Bearish:[/B]The cap at 1.3926 does seem to beg for the pullback to bite just a little deeper. There is resistance at 1.3903 and obviously the 1.3926 high but I feel a break back below 1.3857 is likely before too long at should then cause losses down through 1.3837 to 1.3815 and finally the 1.3780 area where I look for a reversal higher. Only below there extends closer to 1.3720 and possibly 1.3680.[B]MT Bearish:[/B]With the break of 1.3882 I have to rework the likely peak. It is possible that we have seen it – and a move below 1.3680 would confirm. However there does seem a stronger risk of seeing 1.4039 first. ([B]13th September[/B])
[B]ELLIOTT WAVE COMMENTS[/B]
The 1.3926 peak was close enough to the target set yesterday. However, the wave structure just isn’t developing quite as expected and I’ve noticed an alternative which seems to be more logical and holds good Fibonacci relationships in the rally from 1.3550.
Thus I cautiously feel the 1.3718 high could well have been Wave (a) and the correction to 1.3550 was Wave (b). A wave equality target was at 1.3909. A 138.2% projection lies at 1.4046.
A 38.2% expansion of the 1.3851-1.3359 decline is at 1.4039. Thus I feel the 1.3926 high was Wave –iii- of Wave © with a 50% retracement in Wave –iv- expected to support at 1.3780.
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