GBP/JPY – 151.30
New strategy :
Although sterling retreated after surging to 151.90 yesterday and consolidation below this level would be seen initially today, reckon downside would be limited to 150.50-60 and bring another rise later, above said resistance at 151.90 would signal the rise from 146.95 is still in progress for further gain to 152.25-30 but break there is needed to retain bullishness and signal early upmove has resumed for retest of recent high of 152.85 which is likely to hold on first testing.
In view of this, would not chase this rise here and would be prudent to stand aside in the meantime. Below 150.50 would bring test of previous resistance at 150.00 but break there is needed to suggest top is possibly formed, bring weakness to 149.15-20, having said that, only break of support at 148.95 would confirm and revive bearishness for retracement of recent rise to 148.75, then towards 148.00-10.
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.