GBP/JPY - 141.40
Recent wave: Medium term low formed at 120.50 and (A)-(B)-(C) major correction has commenced with (A) leg ended at 148.45, hence wave (B) is unfolding for retreat to 131.00-10.
Trend: Near term up
Sell at 143.60, Target: 141.60, Stop: 144.20
New strategy :
Sell at 142.50, Target: 140.50, Stop: 143.10
Sterling has dropped again after brief recovery to 143.30, adding credence to our bearish view that recent decline from 147.75 top is still in progress for retracement of early upmove and downside bias remains for this fall to extend weakness to 140.80-85 (1.618 times projection of 147.75-144.05 measuring from 146.80), however, near term oversold condition should prevent sharp fall below 140.50 and reckon psychological support at 140.00 would hold from here, bring rebound later.
In view of this, would not chase this fall here and would be prudent to sell sterling on recovery as 142.40-50 should limit upside and bring another decline later. Above 142.80-85 would defer and risk rebound to said resistance at 143.30, however, a sustained breach above this level is needed to signal a temporary low is formed, bring a stronger rebound to 143.90-00.
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.