FX.co ★ Elliott Wave analysis of EUR/JPY for February 4, 2013

Today's Support and Resistance levels:

S1: 125.90 R1: 126.97

S2: 124.83 R2: 127.77

S3: 123.87 R3: 129.18

Technical overview:

The rally higher is relentless in its climb, but we are closing the next important target near 129.18. As long as support at 124.83 protects the downside, we are looking for a break above resistance at 126.97 for the next rally higher towards the next resistance at 127.77 and the important resistance at 129.18. At 129.18 wave v will be 0.618 time the length of the distance traveled from the bottom of wave i to the top of wave iii. This is a very common target for wave v. In the short term only a break below support at 124.83 will question the expected rally higher towards 129.18. A break below 124.83 will call for a continuation towards 123.87 and a break below here will confirm that wave v and wave 3 is already in place.

Trading recommendation:

We will buy EUR at 126.00 or upon a break above 126.97 with a stop at 124.80. Take profit will be set at 129.00.