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The Daily Forecaster

Thu, Oct 9 2008, 03:35 GMT
by Ian Copsey

FX-Forecaster.com

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Bias:         I suspect we'll see a move back higher to 141.04-25

Daily Bullish

The wave structure here remains pretty erratic and it is reminding me more of a complex correction and yesterday's low at 134.13 does seem to have a strong chance of causing a move back higher on the back of bullish divergences in both hourly and 4-hour charts. A break above the 137.95-05 peaks would add weight to this argument. If seen then look for follow-through above 138.74 for 139.50 and 140.45 en route the 141.04-25 area again. I think it will cap.      

Medium Term Bullish
8th October:   The 141.10 area has been tested but on review only a break above 141.77 would extend gains to 143.17. 

Daily Bearish

Yesterday's losses below 135.00 also penetrated the 134.56 support but then found a low at 134.13. With bullish divergences in hourly & 4 hour charts we should be cautious of the downside today. Only while the 137.95-05 area caps and we see a break below 137.05 and 136.50 woudl I then feel that we could see a second move lower to 134.13 and possibly 133.58 and 133.08.

Medium Term Bearish
9th October:   The downside has continued and although we may see the 141.04-25 area retested I feel the downside should easily extend below 134.13 and also the 13308 target which means we may well see the next larger target at 128.12...

Elliott Wave Comments

8th October: 

The correction to 141.04 is inconclusive but the downside still looks at risk. Back above 138.60 would suggest potential for a deeper correction to an alternative 50% retracement in minor Wave iv at 143.77. More likely we shall see loss of the 135.01 low to maintain the wave equality target at 133.08.

9th October:

Losses were seen but stalled at 134.13. This happens to be a 14.6% expansion of the 135.01 -141.05 recovery. Given that we have bullish divergences I suspect that if we get back above the 137.95-05 peaks then there is a good chance we’ll see Wave efc back to the 141.05 peak and maybe small breach.

Overall this will mean that we are still in Wave –c- of Wave –iii- lower and this should easily break below the wave equality target at 133.08 to force further losses.

• The Brief Daily Forecaster

Published on  Thu, Oct 9 2008, 03:39 GMT