EUR/JPY – 123.45
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:
Buy at 120.65, Target: 122.85, Stop: 120.05
Position: –
Target: –
Stop: –
New strategy :
Buy at 122.85, Target: 124.55, Stop: 122.25
Position: –
Target:Â –
Stop:-
As the single currency has surged again after brief pullback, adding credence to our view the rise from 114.85 low is still in progress and bullishness remains for further gain to 124.10 resistance, however, break there is needed to retain upside bias for resumption of early upmove to 124.50-60, then towards 125.00 but overbought condition should prevent sharp move beyond there, risk from there is seen for a retreat later.Â
In view of this, we are looking to buy euro on pullback as 122.85-90 should limit downside and bring another rise. Below support at 122.11 support would defer and risk correction to 121.70 but break of 121.25-30 is needed to signal top is formed, bring retracement of recent rise to 120.85-90 but support at 120.60 should remain intact.
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).
