An excerpt from FX-Strategy’s Pro Commentary
[B]Bias:[/B]Maximum upside should be between 114.89-115.15 (allow for small break) but then lower
[B]Daily Bullish:[/B]The break below 111.97 was brief and was either part of a complex correction or the 111.57 low completed part of the decline from where a correction has developed. This should mean that at the most the upside limit should be between 114.89 (seen on Friday) and 115.15. We should perhaps allow for more though the moves have been so strong the break of the downside now lies at 115.78. Only back above here would imply further gains to 116.14 and probably 117.09.[B]MT Bullish:[/B]The loss to 114.50 so soon when cycles are still bearish for 2 weeks implied it would break and I have to extend the target down to the 108.55-96 area. Reaching here after a correction will bring more confidence. ([B]17th August[/B])[B]Daily Bearish:[/B]Watch the 114.89-115.15 resistance. While this caps a break back below 113.23 would allow the downside to slip to 112.84-94 and probably 112.30-35. Take care in case a sideways ranging develops. Thus only below 112.30 and then 112.05 would imply a retest of the 111.57 low area but should cause a pullback. [B]MT Bearish:[/B]With yesterday’s violent move I would like to see 3-5 days of correction before the next leg lower and if this occurs then I’d feel more confident of the 108.55-96 area being strong enough to force a reversal. ([B]17th August[/B])
[B]ELLIOTT WAVE COMMENTS[/B]
All change once again. Keep in mind that cycles do still seem to be bearish for next week but should begin to find a low over the final week in August – possibly stretching into September.
I found it difficult to justify a 5-wave decline and have placed in an alternative (a)(b)© decline that does hold quite good wave relationships. In Wave © a 261.8% projection in Wave –iii- implies a target at 111.87 and thus given the depth of the pullback from 111.97 it appears we have found this low. Thus I’d like to see Wave –iv- develop below the 50% retracement at 115.35 (58.6% at 115.93) before the final leg lower in Wave © where a 161.8% projection lies at 108.55. Also note the 138.2% projection at 110.20.
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