FX.co ★ EUR/JPY Elliott wave analysis for April 30, 2013

Today's support and resistance levels:

S1: 127.99 R1: 128.61

S2: 127.56 R2: 129.02

S3: 127.05 R3: 129.45

Technical overview:

Our preferred count is that a wave iv triangle is building and setting the stage for one last rally higher towards 135.47 once the triangle is finished. Looking at the structure of the triangle, we are currently building wave d of the triangle, which we expect will end near 130.00. Once wave d of the triangle is finished, we only need one more set-back in wave e before the last rally higher. However, the triangle needs to respect support at 126.43 and, more importantly, support at 124.87. If support at 126.43 breaks, the preferred scenario tilts in favor of a top already being in place at 131.12 and wave (2) developing towards at least 118.73.

Trading recommendation:

We long EUR from 127.30 and will move our stop higher to 127.00. If you do not have long postions on EUR already, then buy EUR at 127.99 or upon a break above 128.60 (one order done cancels the other) with the same stop.