An excerpt from FX-Strategy’s Pro Commentary
[B] Price:[/B] 1.4232
[B]Bias:[/B]Slightly mixed – I see resistance at the 1.4242 high and possibly a test of 1.4281 but then lower
[B]Daily Bullish:[/B]We didn’t see the move down to 1.4121-27 but a direct rally. While this does have a look of being a stronger break higher on the face of it I am not convinced with the internal structure of the recovery. We should see 1.4242 at a minimum – indeed, we are almost there now. However, not in a straight line, but I feel there is risk of a move back to the 1.4281 high. However, look for this to cap and force a move back lower again. Only above 1.4281 extends gains to 1.4394 and 1.4455 over time. [B]MT Bullish:[/B]The downside appears limited to 1.4127-50 but allow for 1.4065. However, the next leg higher appears to be close and a break above 1.4281 should extend the gains to 1.4465 initially. ([B]16th October[/B])[B]Daily Bearish:[/B]Failure to see any losses has put the emphasis back on the top side. However, I’m not convinced this will follow-through to new highs just yet. If we see a messy rally that moves to the 1.4281 high I suspect this will cap and the risk from there is a sharper decline back to the 1.4127-43 area again. This should hold when seen and cause the uptrend to resume again. [B]MT Bearish:[/B]To be honest it looks like the 1.4014 low was the lowest we should expect and I don’t think we’ll see more. Thus only below 1.4060 would press the 1.4014 low and possibly 1.3978 & 1.3916. ([B]12th October[/B])
[B]ELLIOTT WAVE COMMENTS[/B]
The 1.4127-46 range has been tested and while there may be a slightly deeper penetration of this zone I feel that Wave ii may soon be complete. We need only be aware of the possibility of a complex correction from preventing direct gains.
Indeed, the complex correction in Wave ii looks quite possible now. This could be a flat with a peak around 1.4242 or more likely an expanded flat which would have a 38.2% expansion at the 1.4281 high. This should then cause a second move back down to the 1.4143 low and possibly the 50% retracement in Wave ii at 1.4127.
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