FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels - March 16, 2011

The GBP/JPY is developing wave C of medium term downtrend - colored royal blue in the chart. On smaller scale this wave consists of A-B-C subwaves (colored magenta in the chart) with subwave C still developing. On still smaller timeframe the latter subwave C has smaller set of waves A-B-C - colored red in the chart, and wave C is still in development. The targets of the downmove are Fibonacci expansions off 135.56-131.14-135.19, 135.19-132.97-134.40, 134.40-129.75-132.60.

Supports:

- 128.59 = super expanded objective point (SXOP)
- 128.04 = expanded objective point (XOP)
- 127.95 = objective point (OP)

If the price keeps moving up the immediate resistances will be Fibonacci retracements of 132.60-129.23, 134.40-129.23, 135.19-129.23.

Resistances:

- 130.52 = .382 retracement
- 130.91 = .50 ret
- 131.20-31 = confluence area of .382 and .618 retracements
- 131.51-62 = confluence area of .382 and .50 retracements
- etc.

Overbought/Oversold

Assuming that the medium term trend is down it's preferable to look for shorts when the Detrended Oscillator gets above the zero level (15-20 pips above the current price level), or into the overbought area (40-50 pips above the current price).

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