Daily Outlook 19.12.2007 by Dimo Dimov

The cable continues to be under big pressure and we say new sell-off today started from 2.0196. As you can see from the chart, there is a potential impulse started from today’s high which could move the prices far down from the current levels. With an eye on this I enter currently short. There are two possibilities for the length of wave iii – 61.8 % or 161.8 % of wave i. The corresponding levels are 1.9970 and 1.9805. An important resistance level is 2.0032 which is the end of the potential wave i. If the direction is down, this level should stay out of reach today and tomorrow. However in a case of a rise above it, there will be a strong buy signal. So I sell at market with stop and reverse above this level.

Trading strategy: 11:31 EST; 16:31 GMT

Sell at market (1.9975), stop loss - 2.0040 (stop and reverse), target - 1.9810

Confidence level – low

This analysis has only informational and educational purpose and does not represent a proposal for buying or selling currency contracts.