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Trade Idea: EUR/JPY – Buy at 120.90 Print E-mail
Elliott Wave Daily | Written by Action Forex | Mar 06 13 08:29 GMT

EUR/JPY – 121.75

Recent wave: wave v of (C) ended at 94.12 and major correction in wave A is unfolding for gain to 130.00

Trend: Up

Original strategy :

Buy at 120.90, Target: 122.90, Stop: 120.30

Position: - 
Target:  -

New strategy :

Buy at 120.90, Target: 122.90, Stop: 120.30

Position: -
Target:  -

Euro’s near term sideways trading is likely to continue and as long as support at 120.37 (last Friday’s low) holds, consolidation with mild upside bias is seen for gain to 122.55-60, then towards 123.00, however, above 123.00 is needed to confirm low has been formed earlier at 118.80 and suggest the wave iv correction has possibly ended, bring further subsequent rise towards 123.50, then 124.00.

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 for headway towards 128.00-10.

In view of this, we are looking to buy euro on dips. A break of said support would suggest top is possibly formed and risk weakness to 120.00, then towards 119.20-25 support but only below this level would signal the rebound from 118.80 has ended and bring retest of this last week’s low later. Once this support is penetrated, this would signal the decline from 127.71 (wave iii top) has resumed in wave iv for retracement of recent wave iii upmove  to 118.00 and possibly to 117.50 but reckon 116.85 (50% Fibonacci retracement of the wave iii 105.99-127.71) would remain intact, bring another upmove later.

Our preferred 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. Under this count, major correction has commenced in wave A which itself is a 3-waver (probably zig-zag) and may extend headway towards127.70-75 (2.618 times of minor wave a) which is likely to hold from here.

On the bigger picture, we are treating the rally to 169.97 as end of wave A, then selloff from 169.97 (July 2008) to 112.08 is wave (A) of B instead of end of entire wave B and then the rebound from there to 139.26 is wave (B), then wave (C) decline bought euro to as low as 94.12 and the strong rebound from there suggest this wave (C) as well as larger degree wave B has ended and major correction in larger degree wave C has commended for headway to 130.00 and possibly test of previous resistance at 139.26.



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Candlesticks Intraday Trade Ideas Update Schedule (GMT):
1st Update: 0630 - 0700; 2nd Update: 0930 - 1000; 3rd Update: 1230 - 1300; 4th Update: 1500 - 1530

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