EUR/JPY – 123.04
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:
Bought at 123.75, stopped at 123.15
Position: – Long at 123.75
Target: –
Stop: – 123.15
New strategy :
Stand aside
Position: –
Target:Â –
Stop:-
As the single currency has fallen again after brief recovery and indicated previous support at 123.16 was penetrated, suggesting further consolidation below recent high of 125.82 top would be seen and test of another previous support at 122.56 cannot be ruled out, however, break there is needed to retain near term bearishness for the erratic fall from 125.82 to bring retracement of early upmove to 122.00, then towards 121.25-30 with is likely to hold from here.
In view of this, would not chase this fall here and would be prudent to stand aside in the meantime. Above 123.55-60 would bring recovery to 124.00, however, only break of 124.70-75 would suggest the retreat from 125.31 has ended, bring a stronger rebound to 125.00 and possibly towards 125.31. Looking ahead, above 125.31 would extend gain towards strong resistance at 125.82 but break there is needed to confirm recent upmove has resumed and extend headway to 126.20-30 and possibly 126.60-70.
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).
