FX.co ★ Elliott Wave Analysis of EUR/JPY for January 31, 2014

Today's Support and Resistance levels:

R3: 140.27

R2: 139.94

R1: 139.37

Current spot: 138.96

S1: 138.65

S2: 138.18

S2: 137.39

Technical summary:

We are looking for the ongoing wave blue wave iii to start accelerating towards the downside soon. The ideal target for blue wave iii is at 136.15. In the short-term, we expect minor resistance at 139.37 to protect the upside for the next decline, but if the minor resistance is clearly broken, we should expect a minor extension towards 139.94 before the next move lower towards 136.15.

A break below the support line of the base channel will confirm that the expected acceleration lower is developing.

Trading recommendation:

Stay short from 141.85 and keep your stop at 141.30. If you are not short EUR yet, then sell EUR at 139.37 with the same stop at 141.30.