EUR/JPY – 121.42
Recent wave: wave v of (C) ended at 94.12 and major correction in wave A has ended at 149.79
Buy at 119.65, Target: 121.35, Stop: 119.05
New strategy :
Buy at 120.95, Target: 122.55, Stop: 120.35
As the single currency has risen again after finding renewed buying interest at 120.02 yesterday, adding credence to our bullishness and signal the rise from 118.24 low is still in progress for at least a strong retracement of recent decline to 122.00 and possibly towards 122.50 but overbought condition should limit upside and price should falter well below resistance at 122.52, bring another decline later.
In view of this, we are looking to buy euro on dips but at a higher level as 120.90-00 should limit downside and bring another rise. Below 120.45-50 would defer and suggest top is possibly formed instead, risk weakness to said support at 120.02 but break there is needed to provide confirmation and suggest the rise from 118.24 has ended.
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).