EUR/JPY – 122.50
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
New strategy :
Stand aside
Position: –
Target:Â –
Stop:-
Although the single currency has fallen again and near term downside risk remains for recent decline from 125.82 top to extend weakness to 122.00, near term oversold condition should prevent sharp fall below 121.50-60 and reckon 121.25-30 would hold from here, risk from there has increased for a rebound to take place later.
In view of this, would not chase this move here and would be prudent to stand aside in the meantime. Above 123.15-20 would suggest low is possibly formed but break of resistance at 123.65-75 is needed to add credence to this view, bring a stronger rebound towards 124.10-20 which is likely to cap upside.
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).
