Feb. 6, 2006
The stronger USD showed itself on Friday and provided some nice trades down on the EUR, GBP, and up on the CHF both Friday morning and overnight. The question now is how far the EUR will run down before another correction. we'd like to see more movement to the downside, but we may not get it. We would like to see the EUR/USD run down to at least 1.1910 so wave 3 = wave 1 because wave 3 which we are currently in cannot be the shortest wave. Our target range is 1.1950-1.1800 before the EUR/USD will correct upwards and then runs down in a final wave 5. The eventual run up will not be higher than 1.2084, so we'll use just above this level as a stop and to determine our risk:reward ratio for the next trade down. The run down should be at least 200 pips. The EUR currently trades at 1.1976 The GBP has been a bit slow to the party, but we were able to catch 170 pips down on Friday and it's moved down over another 100 pips overnight. We should see at least a bit of correction near here. We're split on whether this will be a small correction with another 100+ pip move down or it'll be larger. The next big trade we are looking at is trading down with 1.7667 as a backstop. This trade should be at least 200 pips. The GBP currently trades at 1.7523. The next big trade we are looking for on the CHF is a trade up with a stop at 1.2850. This may be days to a week out. The CHF currently trades at 1.2987. This move up on the JPY should be complete at the 119.40 level and it should correct down to the 116-118 range before it's run up to the 122-123 level. The JPY currently trades at 118.82 The CAD corrected to the 1.1500 level as expected. It should continue to work lower to the 113 level or below. The CAD currently trades at 1.1454 Forex Currency trading is very risky, please read the disclaimer on our web site. Visit us on the web at www.elliottexchange.com or at forex.podomatic.com. Good Luck and Good Trading
