FX.co ★ Elliott Wave analysis of EUR/JPY for August 8, 2013

Today's Support and Resistance levels:

R3: 129.80

R2: 129.60

R1: 129.33

Current Spot: 129.04

S1: 128.65

S2: 128.24

S3: 127.62

Technical summary:

We saw the expected decline to the minimum target at 128.54 yesterday. As wave i of blue wave iii and wave iii of blue wave iii is equal in length we should expect wave v of blue wave iii to be extended and that would call for a decline towards 126.06.

in the short-term prospects I will be looking for resistance at 129.33 to protect the upside movement from a break below the minor support at 128.65, which will be the first good indication that the next impulsive decline lower is developing and a break below 128.41 will confirm the decline towards 126.06.

However, if we break above 129.33 the downside pressure will be delayed for a push towards 129.60 before we expect renewed downside pressure.

Trading recommendation:

Stay short EUR from 129.55 move stop down to 130.20. If you are not short yet, then sell after a break below 128.65 with the same stop at 130.20.