GBP/JPY – 146.10
Recent wave: Medium term low formed at 120.50 and (A)-(B)-(C) major correction has commenced with (A) leg ended at 148.45, hence wave (B) is unfolding for retreat to 131.00-10.
Trend: Near term up
Original strategy:
Buy at 144.50, Target: 146.70, Stop: 143.90
Position: –
Target: –
Stop: –
New strategy :
Buy at 144.50, Target: 146.70, Stop: 143.90
Position: –
Target:Â –
Stop:-
Current retreat after meeting renewed selling interest at 147.10 has retained our view that further consolidation below recent high of 148.10 would be seen and near term downside risk remains for test of 145.70 support, below there would extend the corrective fall from 148.10 top to 145.00-10, however, reckon downside would be limited to 144.50-60 and bring rebound later. Above said resistance at 147.10 would signal the pullback from 148.10 has ended, bring further gain to 147.50-60, then towards said resistance at 148.10, only a break above there would extend recent upmove from 135.60 to previous chart resistance at 148.45 which is likely to hold from here.
In view of this, we are inclined to buy sterling on subsequent pullback as 144.50-60 should limit downside, bring another rise later. Below said support at 144.00-10 would abort and suggest a temporary top is formed instead, bring correction to 143.50-60 but reckon 143.10-15 would hold from here, bring another rise later.
Our preferred count is that larger degree wave V with circle is unfolding from 251.12 with wave (I) 219.34, (II): 241.38 and wave (III) is subdivided into 1: 192.60, 2: 215.89 (23 Jul 2008) and wave 3 ended at 118.87 earlier in 2009. The correction from there to 162.60 is wave 4 which itself is a double three and is labeled as first a-b-c ended at 151.53, followed by wave x at 139.03, 2nd a ended at 162.60, 2nd b at 146.75 and 2nd c leg of wave 4 ended at 163.00. Therefore, the decline from 163.00 to 116.85 is now treated as wave 5 which also marked the end of larger degree wave (III), hence wave (IV) major correction has commenced for retracement of the wave (III) from 241.38 and upside target at 183.95-00 (50% Fibonacci retracement of the wave (II) from 241.38) had been met, a drop below 160.00 would suggest wave (IV) has ended at 195.85, bring decline in wave (V) for initial weakness to 130 (already met) and 120.

