Cable broke through one of the major resistance zones that were described on Friday, with prices currently trading 120 pips above the 1.4780 level. This was the first broken resistance point seen that may lead into impulse wave count. The market is still below the 1.5000 area which also needs to be broken for a bullish wave count confirmation. Traders need to be patient as the market may initially make three waves of pull-back, near to the black support line, before prices will be able to continue higher again. So, for now, both, triangle and zig-zag wave counts from a daily chart are valid.
Gold Elliott Wave Analysis
Gold has broken through the major 885 support area discussed on Friday, which means that the bearish waves now may be forming a huge red wave C leg, with wave 3 in process. Prices have broken the lows of wave 1 which is confirming lower wave 3 moves. The first target on the way down looks to be around the 857 area with the same length of distance as in wave 1 which is just above the lower parallel line of the bear channel. The next and more likely target is at the 830 area at the 161.8% extension of wave 2 with the possible lows on the lower support line of the channel. This wave count will now be valid so long as prices remain below critical wave 2 resistance point shown.
Written by TheLFB Trade Team, © 2007-2008 LFB Services, LLC. All rights reserved.
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