Wishing you all a very profitable 2008…
[B]Price:[/B] 1.4591
[B]Resistance:[/B]1.46151.46431.46631.4682[B]Support:[/B]1.45761.45401.45271.4504
[B]Bias:[/B]The initial downside may well be over and thus we should see a pullback higher – below 1.4682-05
[B]Daily Bullish:[/B]In the end the 1.4309 low proved to be the key low in this first decline and from there we have seen a move all the way back to 1.4745. However, this has come with a bearish divergence and I suspect a larger decline. However, we should be at, or close to, an intermediate low. The 1.4576-80 area is critical and while this holds we should see a recovery back above 1.4610-15 and then 1.4643 en route 1.4663-82 at least and at most 1.4705-10. Any earlier test of 1.4527 should provide a base. [B]MT Bullish:[/B]With the 1.4309 level providing a base we must be aware of sideways to higher moves. However, I suspect a pullback to 1.4527 min and possibly 1.4412-54 before the next leg higher to 1.4811 & maybe more.[B] (2nd January)[/B][B]Daily Bearish:[/B]The high at 1.4745 should spurn a slightly larger decline. If there is any direct move lower then watch the 1.4527 area which could provide a pullback higher. I suspect we’ll get a better selling level closer to the 1.4663-82 area (max 1.4811) and from here (or direct loss of 1.4520) we can then expect the pullback lower to reach 1.4454-76 at least. Take care from there. Next support is at 1.4412 and I suspect we should see no lower than this…[B]MT Bearish:[/B] It looks like the immediate downside is complete and thus we could see a correction higher or possibly a sideways consolidation. We need to watch the structure to see if this may cause a more complex correction. [B](2nd January)[/B]
[B]ELLIOTT WAVE COMMENTS[/B]
[B]2nd January[/B]
We have seen an ABC structure down to 1.4309 from where price has risen to the area of the prior Wave (b) in 5 waves. This may well be Wave (a) and thus we can expect a correction lower in Wave (b) with a 50% retracement at 1.4527, 61.8% at 1.4476 and a 76.4% at 1.4412.
We need to observe from there and I suspect this will cause a second move higher in Wave ©.
If the cycles have indeed turned lower then we shouldn’t see a move above 1.4966 but we can’t rule out a close test and if this happens in 3 waves then we should also be aware of the risk of a complex correction.
[B]Ian Copsey[/B]
[B]See Also[/B]
[ul]
[li]FX-Strategy Pro Commentary[/li]Powerful analysis for profitable trading[/ul]