FX.co ★ Technical analysis of EUR/JPY for August 15, 2014

General overview for 15/08/2014 09:30 CET

This alternative labeling has been invalidated. Now, the main Elliott Wave count has been established, with the bottom for red wave 1 at the level of 135.71. For the whole week, the market was in a corrective cycle and it looks like a possible zig-zag pattern has been completed; it is labeled here as abc green correction. Moreover, the 61%Fibo level has been reached. The bearish divergence on the momentum oscillator supports the view that a corrective cycle has very little time to last. Nevertheless, please remember that the corrective cycle might evolve to a more complex and time consuming pattern and traders should wait until one of the levels is broken. When that happens, the structure and potential further wave progression will be more clear and friendly for trading.

Support/Resistance:

135.71 - Swing Low

135.80 - WS1

136.35 - Intraday Support

136.85 - Weekly Pivot

137.23 - Intraday Resistance

137.55 - Technical Resistance

137.98 - WR1

Trading recommendations:

Short orders from yesterday have been triggered but it doesn't look like the market is going impulsively to the downside now. Please, wait for more clear structure to appear and bear in mind, that the mid-term bias is still bearish.