FX.co ★ GBP/JPY Elliott wave count and Fibonacci levels for August 29, 2011

GBP/JPY is developing potential impulse wave РЎ (colored royal blue in the chart) of medium term downtrend from 127.31. Within this wave there are A and B subwaves (colored red in the chart) with subwave B still developing from 126.51.

The targets of the downmove are Fibonacci expansions off 130.81-123.27-127.31, 127.31-125.61-126.51.

Supports:

- 123.76 = expanded objective point (OP)
- 122.65 = contracted objective point (COP)

If the price reverses to the upside the immediate resistances will be Fibonacci retracements of 127.31-124.47.

Resistances:

- 125.55 = .382 retracement
- 125.89 = .50 ret
- 126.31 = .618 ret

Overbought/Oversold

Assuming that the major wave is down it's preferable to try short positions when the Detrended Oscillator gets above the zero level (current prices) or into the overbought area (15-30 pips above the current prices).

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