FX.co ★ Elliott Wave analysis of EUR/JPY for November 11, 2013

Today's Support and Resistance levels:

R3: 132.99

R2: 132.76

R1: 132.57

Current spot: 132.27

S1: 131.89

S2: 131.58

S3: 131.20

Technical summary:

Wave 1 or A ended with the test of 135.51 and we have now started a correction of wave 1 or A in wave 2 or B, as a minimum we are looking for a correction towards 124.92, where wave 2 or B would have corrected 23.6% of wave 1 or B. However, it is more likely, that the ongoing correction corrects 38.2% of wave 1 or A, which would call for a correction towards 119.70. As the decline from 135.51 has been in five wave we will be looking for a zig-zag correction lower, but corrections can undertake many different patterns, which makes them hard to read from time to time.

In the short term we expect resistance near 132.76 for a break below 131.89 and, more importantly, a break below support at 131.50 which calls for an acceleration lower towards at least 128.42 and likely even lower to 125.76 as red wave iii extends.

Trading recommendation:

Stay short from 131.50 or sell near 132.76 with a stop at 133.75.