GBP/JPY - 143.00
Recent wave: Medium term low formed at 120.50 and (A)-(B)-(C) major correction has commenced with (A) leg ended at 148.45, hence wave (B) is unfolding for retreat to 131.00-10.
Trend: Near term up
New strategy:
Sell at 143.65, Target: 141.65, Stop: 144.25
Position: -
Target: -
Stop:-
For trade ideas on other pairs, visit trade ideas section.
Sterling met renewed selling interest at 145.45 and has tumbled from there, price just broke below previous support at 143.40, confirming the selloff from 148.10 top has resumed, hence bearishness is seen for this move to extend further weakness to 142.10-15, however, break there is needed to retain bearishness and bring subsequent fall to 141.50-60 which is likely to hold on first testing due to near term oversold condition.
In view of this, we are looking to sell euro on recovery as 143.60-70 should limit upside and bring another decline later. Above 144.00 would risk a stronger rebound to 144.50 but upside would still be limited to 145.00 and price should falter well below said resistance at 145.45, bring another decline later.
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.
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