FX.co ★ Elliott Wave Analysis of EUR/JPY for December 24 - 2012

Today's Support and Resistance Levels:

S1: 111.03 R1: 111.43

S2: 110.60 R2: 111.84

S3: 110.35 R3: 112.49

Technical Overview:

With low at 110.60 we could have seen the bottom of wave iv, but if this is the case, we need a break above 111.51. A break above 111.51 will confirm a continuation higher towards 112.49 and higher towards 113.15 as the next target. That said, as long as minor resistance at 111.51 protects the upside, we must accept the possibility of a slightly deeper correction towards 110.47 and maybe even 110.00 before the ongoing correction terminates and the next rally can take place. There is also a possibility of this correction to become more complex, but we need to see how things develop from here. However, one thing is clear: we are in a correction and higher highs should be seen once this correction is finished.

Trading Recommendation:

We are long on EUR from 106.75 with a stop at 109.85. If you have been long on EUR already, buy at 110.50 or break above 111.51 (one order cancels another) with the same stop.