» Pro Commentary Lite … 8th May 2008 … GBPUSD

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Pro Commentary Lite … 8th May 2008 … GBPUSD

An excerpt from Pro Commentary

 Price:                            1.9507

Resistance: 1.9550 1.9595 1.9634 1.9668
Support: 1.9502 1.9475 1.9438 1.9406

Hourly chart with indicators

Bias: The 1.9470-80 area should support for a recovery to 1.9590-00 before lower again

Daily Bullish: Breach of the 1.9599 low has brought stronger losses but I feel we are close to an intermediate support around 1.9470-80 (max 1.5455). This should allow a correction higher. A move back above 1.9535-50 will help but should then find the 1.9590-00 area too much and trigger additional losses. There is further resistance at 1.9630-35 and only above here will imply a stronger recovery to 1.9708-11 at least. Take care here but I feel then the more likely target will be back at 1.9771 again.
MT Bullish: 7th May: The Pound is finding it increasingly difficult to sustain a move higher. Thus only back above 1.9808 followed by 1.9908-22. If this is seen then we should see a larger correction higher.
Daily Bearish: As highlighted the break below 1.9599 and then 1.9548 has brought price down to the 1.9505 support. There is possibly just a little further to go on this part of the decline but any direct loss should stall at 1.9470-80 to open up a correction higher. Any return to the 1.9590-00 area should provide a selling opportunity but stops should be above 1.9635. A move from there below 1.9450-70 would extend the decline to the 1.9335-61 area at least. In this general area I’d expect a larger correction higher.
MT Bearish: 7th May: To be honest I don’t really like the downside structure but the continued downside pressure could open up a larger decline through 1.9548 and suggest an eventual test of the 1.9335-61 area which should hold. 

ELLIOTT WAVE COMMENTS

Elliott Wave Chart

8th May

With the break lower I can only assume that the final recovery to 1.9771 was Wave ^e of an exceptionally erratic triangle structure. From there we appear to be seeing a 261.8% projection in minor Wave iii to around 1.9470-80. This should set up a correction in Wave iv to 1.9590-00 before losses again with a final target around the 1.9335 low.

If this is correct then it would represent Wave –a- only and would imply a Wave –b- and then Wave –c- to a new low.

However, we need to be aware of the large picture that suggests a larger flat or expanded flat. The former would imply a low around 1.9335. For now I’ll target this level and watch the next move.

Ian Copsey

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