FX.co ★ EUR/JPY Wave Analysis for September 17,2012

EUR/JPY Elliott Wave
Since our last analysis, the EUR/JPY pair was trading in an upward move, like we expected, developing impulsive (3) wave (coloured green) of the bigger wave (A) (coloured orange). During the Friday's Asian and European sessions we could observe a strong ascending movement from 100.62 towards the 102.28 level. Therefore, during the New York session this currency pair continued trading in a bullish mood reaching a new high at 103.01 level and we can consider this move as the end of the impulsive 5 wave (coloured blue) of the bigger wave (3). Today the EUR/JPY pair is trading around 102.60 level and we are expecting to see price at 99.95 level soon. In accordance with our wave rules and taking into account that the wave 4 should retrace 23.6% of the wave 3, we can define the potential targets with measuring 3 wave, with Take Profit 1 at 101.12 (23.6% of wave 3) and Take Profit 2 at 99.95 (38.2% of wave 3). To reduce the risk, we can use resistance at 103.40 level as Stop Loss.
Support and Resistance
(S3) 99.72 (S2) 100.66 (S1) 101.23 (PP) 102.16 (R1) 103.10 (R2) 103.67 (R3) 104.60
Trading Forecast
Proceeding from Elliott Wave rules today, the trend is expected to begin the downward movement. That is why short positions at level 102.50 with Stop Loss 103.40 ,Take Profit 1 at 101.12 and Take Profit 2 at 99.95 are recommended.