FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels, July 22, 2010

GBP/JPY has just ended the upside movement 131.17-135.80 having broken 131.17 - since this is the base of the upwave. At the moment we have weekly wave C (colored plum on the chart). Its targets are Fibonacci expansions off 136.00-131.17-135.80. More targets are represented by Fib expansions off waves of smaller degree - 135.80-131.42-133.71, 133.71-132.30-133.61.

Price targets below the current level:

- 131.00-130.97 = confluence area of contracted objective point (COP) and objective point (OP)
- 129.92 = super expanded objective point (SXOP)
- 129.33 = OP

In case the price reverses to the upside the nearest resistances will be Fibonacci retracement points of the downwave starting from 133.71.

Overbought/Oversold

The Detrended Oscillator is slightly below the zero level. Assuming that the prevailing trend is down it's better to wait for a tradable retracement some 60-80 pips up and then calculate the nearest Fibonacci resistance. In case of a topping signal the Fib-node will be the best price to enter short.