GBP/JPY – 142.00
Original strategy:
Sold at 142.00, Target: 140.00, Stop: 142.60
Position: – Short at 142.00
Target: – 140.00
Stop: – 142.60
New strategy :
Exit short entered at 142.00
Position: – Short at 142.00
Target:Â –
Stop:-
As the British pound found renewed buying interest at 140.05 earlier this week and has staged a strong rebound, suggesting temporary low has been formed at 139.35 last week and near term upside risk remains for this rebound from there to extend gain to 142.50-60, however, reckon upside would be limited to 143.00 and resistance at 143.20 should remain intact, bring another decline later.
In view of this, would be prudent to exit short entered at 142.00 and stand aside for now. Below 141.40-45 would bring test of 140.95-00, break there would suggest top is possibly formed, then weakness to 140.40-45 would follow but only break of support at 140.05 would revive bearishness and signal the rebound from 139.35 has ended, then retest of this level would be seen eventually.
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.

