An excerpt from FX-Strategy’s Pro Commentary
Bias:I still prefer a test higher to 1.3512-34 before reversing lower
Daily Bullish:The warning of the support between 1.3403-17 was correct in the end though it makes the structure a little more difficult to read. Still, within this we should be looking at a test towards the 1.3512-34 area. For this to occur I’d prefer the 1.3447 support to hold but could accept a small breach. However, the 1.3512-34 area should be the maximum we see within a larger declining market. Thus only above 1.3535 would begin to push the 1.3570-80 resistance and then the 1.3608-26 highs. MT Bullish:The recovery from 1.3415 may look bullish but we’ll need to see a break back above 1.3534 and then 1.3570-80 to confirm. If seen look for a retest of the 1.3681 high en route 1.3932-1.4016 eventually. (May 24th)Daily Bearish:No break below 1.3403-17 and thus the downside hasn’t developed – yet. I still see the move to 1.3415 as the first past of a final decline and thus what we are seeing should only be a correction and this sees resistance at 1.3512 and maximum 1.3434. While this area caps a move back lower would pass quickly through 1.3415 and towards targets at 1.3345 & 1.3253-73. Only an earlier breach of 1.3435-47 would suggest this can occur directly. MT Bearish:Price has continued to decline and I remain eyeing the 1.3253-73 area as a preferred target for this decline – but also note the 1.3203 area. Somewhere in this region I’ll be looking for a stronger reversal higher. (May 22nd)
ELLIOTT WAVE COMMENTS
The lack of upside frustrates the scenario calling for an expanded flat Wave c to 1.3529-36. I won’t give it up just yet but need a break above yesterday’s 1.3475 high to confirm. Any earlier loss – well watch a possible 61.8%-76.4% projection at 1.3403-17. Only below there means we’re on the last leg lower to 1.3330-45 and later to the daily 50% retracement at 1.3275.
The warning of the 1.3403-17 area yesterday was a possible Wave v extension in Wave –a- and thus this recovery sees resistance between the 50% & 61.8% retracement at 1.3512-34 from where we should see Wave –c- develop.
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