GBP/JPY – 144.56
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:
Sell at 145.30, Target: 143.30, Stop: 145.90
Position: –
Target: –
Stop: –
New strategy :
Sell at 145.90, Target: 143.90, Stop: 146.50
Position: –
Target:Â –
Stop:-
Sterling continued finding support at 144.05 and has recovered, suggesting minor consolidation would be seen and initial recovery to 145.50-60 cannot be ruled out, however, upside should be limited to 146.00 and bring another decline later, below said support at 144.05 would add credence to our view that a temporary top has been formed at 147.75 earlier this month, bring retracement of recent upmove to 143.50, then towards support at 143.30, however, oversold condition should limit downside to 142.90-00 and price should stay above previous resistance at 142.50.
In view of this, would not chase this fall here and we are looking to sell sterling on further subsequent recovery as 145.90-00 should limit upside, bring another decline. Above resistance at 146.30-35 would abort and signal low is formed instead, bring a stronger rebound to 146.90-00 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.

