EUR/JPY – 121.85
Recent wave: wave v of (C) ended at 94.12 and major correction in wave A has ended at 149.79
Trend: Near term up
Original strategy:
Bought at 121.80, Target: 123.80, Stop: 121.20
Position: – Long at 121.80
Target: – 123.80
Stop: – 121.20
New strategy :
Exit long entered at 121.80,
Position: – Long at 121.80
Target:Â –
Stop:-
Although euro recovered after finding support at 121.63, the retreat from 122.89 suggests near term downside risk remains for this move to bring retracement of recent upmove to 121.45-50, however, break of previous resistance at 121.13-19 is needed to signal top has been formed at 122.89, bring further weakness to 120.50-60 first.
In view of this, would be prudent to exit long entered at 121.80 and stand aside for now. Above 122.14 (previous support now resistance) would bring rebound to 122.64 resistance but break there is needed to revive bullishness and signal the pullback from 122.89 has ended, bring retest of this level, break there would extend recent rise from 118.24 to 123.30-35. Looking ahead, a sustained breach above this level is needed to retain bullishness and signal early erratic fall from 124.10 top has ended at 118.24, bring further rise to 123.85-90 first.
Our latest preferred count is that wave (ii) is ABC-X-ABC which ended at 123.33 and wave (iii) is unfolding with wave iii ended at 100.77, followed by wave iv at 111.57 and wave v as well as the wave (iii) has ended at 97.04, followed by wave (iv) at 111.43 and wave (v) has ended at 94.12 which is also the end of the larger degree v, this also implied the major wave (C) has also ended there, hence major correction has commenced from there with (A) leg unfolding in its lower degree wave c which has possibly ended at 145.69. Under this count, A-B-C wave (B) has commenced with A leg ended at 136.23, wave B at 143.79 and wave C has possibly ended at 149.79.
Our larger degree count is that the decline from 139.26 is wave (C) and is sub-divided into a diagonal triangle i-ii-iii-iv-v with wave i – 105.44, wave ii- 123.33, wave iii – 97.03, wave iv – 111.43, followed by the final wave v as well as the end of wave (C) at 94.12, this also mark the bottom of larger degree wave B. Under this count, major rise in wave C has commenced as an impulsive wave with minor wave III ended at 145.69, wave V is still in progress for further gain to 150.00. Having said that, this so-called wave V could well be the first leg of larger degree 5-waver wave C and this wave C should bring at least a retest of wave A top at 169.97 (July 2008).
