FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels - February 2, 2011

The GBP/JPY is developing potential wave C of medium term uptrend - colored magenta in the chart. To confirm wave C break above 132.64 is needed, it's the top of wave A. At this moment the nearest resistances are Fibonacci expansions off 125.47-132.48-129.49, 129.49-132.64-129.75, 129.75-131.96-130.91.

Resistances:

- 132.05 = objective point (OP)
- 132.28 = contracted objective point (COP)
- 132.61 = expanded objective point (XOP)
- 132.90 = OP
- 133.12 = OP
- 133.52 = super expanded objective point (SXOP)
- 133.82 = COP

If the price reverses down the nearest supports will be Fibonacci retracements of 125.47-132.64, 129.75-131.96, and expansions off 132.64-129.75-131.96.

Supports:

- 130.86 = .50 retracement
- 130.59 = .618 ret
- 130.17 = COP
- 129.07-06 = confluence area of OP and .50 ret
- 128.21 = .618 ret

Overbought/Oversold

Assuming that the medium term trend is still up it's preferable to use oversold readings of the Detrended Oscillator or its cross below the zero to consider long positions. The oscillator is slightly above the zero level, therefore stand aside until the price hits a Fib support and only then consider long positions.

Read more on how to apply Fibonacci studies to calculate price targets.