GBP/JPY – 140.35
Original strategy:
Sell at 141.20, Target: 139.20, Stop: 141.80
Position: –
Target: –
Stop: –
New strategy :
Sell at 141.20, Target: 139.20, Stop: 141.80
Position: –
Target: –
Stop:-
As the British pound found support at 139.80 and recovered, suggesting consolidation above this level would be seen and another bounce to 140.90-00 cannot be ruled out, however, previous support at 141.25 should limit upside and bring another decline, a break of said last week’s low at 139.80 would extend recent decline from 147.75 top to 139.50 but loss of downward momentum should prevent sharp fall below 139.00-10 and price should stay well above previous support at 138.70.
On the upside, whilst recovery to 141.00-10 cannot be ruled out, reckon upside would be limited to previous support at 141.25 (now resistance) and bring another decline later. Only break of resistance at 142.05 would suggest low is possibly formed instead, bring a stronger rebound to 142.50-60 but resistance at 143.20 should remain intact and bring another decline 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.
