HomeTrade IdeasElliott Wave DailyTrade Idea: EUR/JPY - Target met and stand aside

Trade Idea: EUR/JPY – Target met and stand aside

EUR/JPY – 122.50

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

Original strategy:

Bought at 120.95, Target: 122.55, Stop: 120.35

Position: – Long at 120.95
Target: 122.55
Stop: –

New strategy :

Stand aside

Position: –
Target:  –

The single currency eased to 120.86 yesterday and renewed buying interest did emerge there (we recommended to buy at 120.95 and a long position was entered), retaining our bullishness and the subsequent anticipated rally just reached our indicated upside target at 122.55 as price rose to 122.56 in European morning. Although current firmness suggests bullishness remains for the rise from 118.24 low to extend further gain to 122.90-00, reckon upside would be limited to 123.30-35 and bring retreat later.

In view of this, would not chase this rise here and would be prudent to stand aside in the meantime. Below 122.00 would bring pullback to 121.75-80 but reckon support at 121.48 would limit downside, only break of support at 121.30 would suggest top is formed instead, bring correction to 120.90-00 later.

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).

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