EUR/JPY – 133.47
New strategy :
Buy at 132.95, Target: 134.95, Stop: 132.35
Although the single currency has retreated after rising to 133.89 and consolidation below this level would be seen, reckon downside would be limited to 132.95-00 and bring another rise later, above said resistance at 133.89 would extend the rise from 131.40 low towards previous resistance at 134.50, however, break there is needed to retain bullishness and extend recent upmove towards 135.00, then 135.50 but upside would be limited to 136.00-10.
In view of this, we are looking to buy euro on pullback as 132.95-00 should limit downside and bring another rise later. Only below previous resistance at 132.60 would abort and suggest top is formed instead, bring weakness to 132.20-25 but support at 131.93 should limit downside, price should stay well above said support at 131.40.
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).