FX.co ★ Elliott Wave analysis of EUR/JPY for June 18, 2013

Today's Support and Resistance levels:

R3: 127.96

R2: 127.27

R1: 127.01

Current spot: 126.63

S1: 126.13

S2: 125.41

S3: 124.96

Technical overview:

We are currently in a wave 2 correction, correction of the entire rally from the 94.10 low to the 133.81 high. We expect this correction to correct 38.2% of wave 1, which will give us an ideal target near 118.73. We are currently in the middle of this correction and is looking for important resistance at 127.01 to protect the upside for a break below 126.13, which will confirm a new test of strong neck-line support at 124.96 and a break here will accelerate the decline towards our ideal target 118.73. However, if important short-term resistance at 127.01 gives away, we need a move higher to 128.28 before we can expect the next part of this decline.

Trading recommendation:

We are short EUR from 130.75 and has our stop at 127.10. If you are not short EUR alreay, then sell upon a break below 126.13 with a stop at 127.10 too.