FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels, September 10, 2010

Pound/yen is still developing daily downtrend within wave C (colored light green on the chart). However within this wave we have a set of A-B daily waves (colored royal blue) with wave B being corrective. So the targets of the upside movement are Fibonacci retracements of the daily A wave (royal blue) 133.59-127.89, and expansions off A-B hourly waves (the red ones) 127.89-130.30-128.55.

Resistances:

- 130.04 = contracted objective point (COP)
- 130.74 = .50 retracement
- 130.96 = objective point (OP)
- 131.41 = .618 ret
- 132.45 = expanded objective point (XOP)

In case the price reverses to continue the daily downtrend, the nearest support will be Fibonacci projection off 137.75-128.77-133.59.

Support:

- 128.04 = contracted objective point (COP)

Overbought/Oversold

The Detrended Oscillator is moving up from the red zone. Assuming that the movement up is corrective it's advisable to stand aside if you seek for long-term trends. However short term longs are favored on weaknesses, e.g. the nearest oversold is 50-60 pips below the current price.