EUR/JPY – 129.10
Recent wave: A 5-waver is unfolding from 114.85 with wave iii and iv ended at 125.82 and 122.40 respectively, wave v has possibly ended at 131.40.
Trend: Near term up
Original strategy:
Bought at 129.45, Target: 131.00, Stop: 128.85
Position: – Long at 129.45
Target: – 131.00
Stop: – 128.85
New strategy :
Hold long entered at 129.45, Target: 131.00, Stop: 128.85
Position: – Long at 129.45
Target:Â – 131.00
Stop:- 128.85
Although the single currency surged to 130.40 yesterday, the subsequent strong retreat dampened our bullishness and 128.90-00 needs to hold to retain prospect of another rebound, above 129.80-85 would bring another test of said resistance, break there would add credence to our view that at least the first leg of decline from 131.40 top has ended at 128.05 and extend gain to 130.85-90, however, as broad outlook remains consolidative, upside would be limited and said resistance at 131.40 should remain intact, bring another retreat later this week.Â
In view of this, we are holding on to our long position entered at 129.45. Below 128.90 would risk weakness to 128.50, then retest of Friday’s low at 128.05 but break there is needed to revive bearishness and signal the decline from 131.40 top is under way for retracement of early upmove to 127.50-60, then towards 127.00-10.
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).
