FX.co ★ Elliott Wave Analysis of EUR/JPY for January 2, 2013

Today's Support and Resistance Levels:

S1: 115.53 R1: 115.99

S2: 115.27 R2: 116.56

S3: 114.85 R3: 116.94

Technical Overview:

The wave iv correction became a new sub-normal correction, as the correction only fell to 113.13 before taking off again in wave v of 3. We expect this wave v of 3 to reach 117.31, where wave 3 will be 1.618 times longer than wave 1. This is a very common extension target and is the smallest extension we expect for wave 3. Looking at the short-term structure for wave v of 3 we are currently in wave iv of iii of 5 and should soon see wave v of iii of 5 higher towards 116.49 before we expect minor correction in wave iv before the last wave higher towards 117.31.

Trade Recommendation:

We unfortunately missed much of the rally of the 113.13 low, but we will buy EUR here at 115.54 with a 114.75 stop and take profit at 117.20.