FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels - March 21, 2011

The GBP/JPY is developing wave A of medium term uptrend - colored royal blue in the chart. Within this wave there's corrective subwave B developing - colored red in the chart. The targets of the downmove are Fibonacci retracements of 126.02-132.55, 122.49-132.55.

Supports:

- 130.06 = .382 retracement
- 129.29 = .50 ret
- 128.71 = .382 ret
- 128.51 = .618 ret
- 127.52 = .50 ret
- 126.33 = .618 ret

If the uptrend resumes and the price breaks above 132.55, the immediate resistances will be Fibonacci expansions off 122.49-132.55-130.50, and 126.02-132.55-130.50.

Resistances:

- 134.54 = contracted objective point (COP)
- 136.72 = COP
- 137.03 = objective point (OP)

Overbought/Oversold

Assuming that the medium term trend is up it's preferable to look for longs when the Detrended Oscillator gets below the zero level (current prices), or into the oversold area (120-180) pips below the current price - this rougly corresponds to 130.06 Fib support level.

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