FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels for August 5, 2011

GBP/JPY has developed the wave from 135.11 to 124.16 and is now moving in a corrective wave against this movement. Current wave A of long term uptrend (colored light green in the chart) now has A and B subwaves, with subwave B still developing from 130.81 (colored magenta in the chart).

The targets below the current price level are Fibonacci retracements of 124.16-130.81, and 125.25-130.81.

Supports:

- 127.49-37 = confluence area of .50 and .618 retracements
- 126.70 = .618 ret

If the price keeps moving up the immediate resistances will be Fibonacci retracements of 139.94-124.16, 135.11-124.16, and expansions off 124.16-130.81-127.51.

Resistances:

- 130.93 = .618 ret
- 131.62 = contracted objective point (COP)
- 132.05 = .50 ret
- 133.91 = .618 ret
- 134.16 = objective point (OP)

Overbought/Oversold

Assuming that the medium term trend is now up it's preferable to try long positions when the Detrended Oscillator gets below the zero level (current prices) or into the oversold area (60-90 pips below the current prices).

Read more on how to apply Fibonacci studies to calculate price targets.