FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels for August 18, 2011

GBP/JPY is developing corrective wave B of medium term downtrend from 123.27 (colored magenta in the chart). Within this wave there are three subwaves (colored red in the chart) with subwave C still developing from 125.24.

The targets of the upmove are Fibonacci retracements of 130.81-123.27, and expansions off 123.27-126.42-125.24.

Resistances:

- 127.04 = .50 ret
- 127.19 = contracted objective point (COP)
- 127.93 = .618 ret
- 128.39 = objective point (OP)

If the price reverses to the downside the targets of the downmove will be Fibonacci retracements of 123.27-126.95.

Supports:

- 125.54 = .382 ret
- 125.11 = .50 ret
- 124.68 = .618 ret

Overbought/Oversold

Assuming that the major 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 (25-40 pips below the current prices).

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