FX.co ★ Elliott wave analysis of EUR/JPY for August 19, 2013

Today's Support and Resistance levels:

R3: 130.72

R2: 130.42

R1: 130.14

Current spot: 130.11

S1: 129.81

S2: 129.42

S3: 129.12

Technical summary:

Since the last update, the price-action has unfolded less impulsive than expected. Therefore we have changed our short term count slightly. That means the count above is now our preferred count closely followed by two other possible counts (see below).

Our preferred count shows that the decline from 132.74 unfolded in a new zig-zag decline which we have called Y and we have most likely seen a new X-wave to 130.72, which now acts as important resistance, which we expect will protect the upside for a break below 129.81 and more importantly a break below 129.42 calling for the final zig-zag lower toward strong support at 124.96 in a flat correction.

As can be seen our preferred count and the alternate count No. 1 is both calling for a move lower, while our alternate count No. 2 is calling for a break above 130.72 towards 132.00 to end wave d of a triangle.

Trading recommendation:

Sell EUR here at 130.11 with a stop at 130.75.