EUR/JPY – 119.91
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: –
Stop:-
Although the single currency retreated after meeting resistance at 120.28, break of last week’s low at 119.32 is needed to signal the fall from 122.89 top is still in progress and may extend weakness to 119.00, then 118.67 support but loss of momentum should prevent sharp fall below latter level and price should stay well above previous chart support at 118.25, risk from there is seen for a rebound later.
In view of this, would not chase this fall here and would be prudent to stand aside in the meantime. If said support at 119.32 continues to hold, then further consolidation would take place and another bounce to 120.28 cannot be ruled out, above there would bring retracement of recent decline to 120.60-70, then 121.15-20. Only break of said resistance at 121.84 would revive bullishness and suggest low is formed instead, bring test of indicated resistance at 122.26 first.
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).
