FX.co ★ Elliott wave analysis of EUR/JPY for May 19, 2014

Today's Support and Resistance levels:

R3: 140.58

R2: 140.15

R1: 139.63

Current spot: 138.98

S1: 138.77

S2: 138.17

S3: 137.38

Technical summary:

We are still looking for a short-term correction towards the 139.63 - 139.88 area before the next decline towards 137.01 to end red wave iii. As red wave ii was a deep correction, that corrected most of red wave i we should expect a sideways consolidation as red wave iv.

In the longer term we are still looking for a deeper correction of the rally from 94.10 to 145.69, with the ideal corrective target coming in near 126.00.

Trading recommendation:

Stay short in EUR from 140.95 with a stop at 139.95. If you are not short in EUR yet, then sell in the 139.63 - 139.88 area with the same stop at 139.95.