FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels - March 28, 2011

The GBP/JPY is developing corrective subwave B (colored magenta in the chart) within wave A of medium term uptrend - colored royal blue in the chart. The targets of the downmove are Fibonacci retracements of 126.02-133.04, 122.49-133.04.

Supports:

- 129.53 = .50 ret
- 129.01 = .382 ret
- 128.70 = .618 ret
- etc.

If the price keeps advancing the immediate resistances will be Fibonacci retracements of 133.04-130.19.

Resistances:

- 131.28 = .382 ret
- 131.62 = .50 ret
- 131.95 = .618 ret

Overbought/Oversold

Assuming that the medium term (corrective subwave B) is down it's preferable to look for shorts when the Detrended Oscillator gets above the zero level (current prices), or into the overbought area (10-20 pips above the current price), or wait for a stronger retracement to one of the Fib resistances above.

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