FX.co ★ Elliott Wave analysis of EUR/JPY for January 7, 2014

Today's Support and Resistance Levels:

R3: 143.10

R2: 142.78

R1: 142.52

Current Spot: 142.25

S1: 141.94

S2: 141.73

S3: 141.49

Technical Summary:

Red wave v and black wave i fell short of its ideal target near 141.24 and we are now in black wave ii, which ideally will make it to resistance at 143.10. However, we have to remember that second waves are allowed to correct up till 100% of the first wave.

Short-term we should be looking for a move closer to 143.10 as long as support at 141.94 and more importantly as long as 141.73 protects the downside. From 143.10 or upon a break below 141.73 we should expect black wave iii to take over for a powerful decline towards at least 138.85 and likely even lower towards 136.26.

Trading recommendation:

We will sell EUR at 143.00 or upon a break below 141.94 (one order done cancels the other). Stop will be placed at 145.70 expected to move it lower quickly.