GBP/JPY - 146.00
Buy at 144.80, Target: 146.80, Stop: 144.20
New strategy :
Buy at 145.00, Target: 147.00, Stop: 144.40
Although sterling has retreated after rising to 146.65 earlier today, this week’s rally signals early fall from 147.75 has ended at 139.35 (tentatively the final e leg of larger degree wave B), hence bullishness remains for test of resistance at 146.80, break there would add credence to this view and encourage for headway to 147.30-40, then retest of previous resistance at 147.75 which is likely to hold from here due to near term overbought condition,
In view of this, we are looking to buy sterling on pullback but at a higher level as 144.90-00 should limit upside. Only below said previous resistance at 143.00 (tentatively wave i top) would abort and signal top is formed instead, bring weakness to 142.50, then 142.20-25, however, reckon support at 141.30-35 would remain intact, bring another rebound later.
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.