FX.co ★ EUR/JPY Elliott Wave analysis for February 14, 2013

Today's support and resistance levels:

S1: 125.21 R1: 125.98

S2: 124.77 R2: 126.57

S3: 124.03 R3: 126.95

Technical overview:

We are currently looking for a break below minor support at 125.21 and, more importantly, below support at 124.77 to confirm the next move lower in wave c of 4. This next move lower should be quite powerful and will likely reach 123.79 quickly once we break below 125.21. However, our longer term target for wave c is at 117.24, but we must expect that strong support at 120.71 will put up a real fight. In the short term, we are looking for resistance at 125.97 to protect the upside for a break below 125.50. If, however, we break above 125.97, resistance at 126.57 should do the job and protect the upside otherwise we will likely have to reevaluate our count.

Trading recommendation:

We short EUR from 126.15 with a stop at 127.00. Upon a break below 125.50 we will move our stop lower to break-even.