Sunday, 22 August 2010

12:09 BST - Dollar Update: 25 min chart

Just a quick note on the dollar to update the position since my last post on it which you can see here.

Dollar 25 min:

I've labelled Friday's high and the subsequent pullback as waves (3) and (4) of wave [3] (wave (4) may still have more downside to go even though I've put the label in). If this is correct, then wave (4) musn't end within the territory of wave (1). The high of wave (1) is at 82.610.

At the moment the count looks good, but we need to watch that level in this pullback.

If the count is correct, we need a wave (5) up to complete wave [3]. I would expect wave (5) to try to get back to the median line of the green fork (which it did in wave (3)), but potentially fail to get there, which would be bearish near term and consistent with a wave [4] retracement. On a wave [4] retracement we'd then need to watch the high of wave [1] at 82.717 since wave [4] must not end below that high.