An excerpt from FX-Strategy’s Pro Commentary
Bias:While any consolidation remains below 121.23-48 we should see 120.50 and eventually 119.73-00
Daily Bullish:Indeed, the 121.86-122.18 area was too heavy and we have finally seen a move lower. This still has further to go and I suspect the 121.23 level could hold – maximum 121.48. Thus to revert to a more bullish stance we shall need to see a break back above 120.48 and if seen it should quickly retest the 121.86-122.18 area. This should hold on first test. Next major resistance is at 122.63. MT Bullish:The additional gains have been seen but are now approaching the key resistance levels at 121.69-89 and 122.18. I’d prefer these areas to cap – only a break above 122.18 gives 122.63 before lower. (May 22nd)Daily Bearish:The second attempt at 121.86 failed and the reversal below the 121.30-40 area has seen a move down to 120.84 thus far. This may well cause a period of consolidation but note resistance at 120.23 and at 120.48. While these cap there is still risk of further losses. Watch the pivot support at 120.550 which should stall any initial attempt lower but once this breaks the risk appears to be to 120.04 minimum and maximum 119.73 from where we should see a recovery. MT Bearish:With the more decisive decline we can plan a little more. I still feel the 122.20 and possibly 120.63 areas will be tested before a larger reversal lower. Only directly below 119.46-73 would generate immediately. (May 25th)
ELLIOTT WAVE COMMENTS
I note the 121.94 level is a 261.8% projection in Wave –iii-. While I’d prefer to have a wave structure that implies this 121.86-122.18 area as a major high and for losses in a daily flat correction to 115.16, a Wave –iii- around here would still need one more high.
Still, either way, we should be seeing a deep enough correction at the very least in a possible Wave –iv- that would imply losses to around 120.00.
The decline in what looks like Wave –iv- is underway. The 50%-58.6% retracement support lies at 119.73-120.04. While this holds we should see Wave –v- reach 122.20 again and possibly the 122.63 weekly triangle target.
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