FX.co ★ Elliott Wave Analysis of EUR/JPY for April 25, 2013

Today's Support and Resistance levels:

S1: 129.36 R1: 129.99

S2: 128.80 R2: 130.67

S3: 129.30 R3: 131.12

Technical overview:

The price action lately has been corrective in its structure both in up and down moves, which could be consistent with a triangle developing. If a triangle is developing, we know that we will see the last thrust towards the upside followed by a correction. Even though it was very difficult to decipher the price action lately, one last rally to above the former top at 131.12 will fit the best scenario. If a triangle is developing, we can expect a move towards 135.47 in wave v. The target is arrived by measuring the widest part of the triangle and add that to the possible bottom of wave e of the triangle. Wave e is still not in place, but a qualified guess is that wave e will terminate close to support at 128.80. That said, a break below 127.86 and more important break below 126.43 will invalidate the triangle scenario and indicate that wave 5 (1) is already in place at 131.12 and wave (2) is developing.

Trading Recommendation:

We short EUR from 128.70 and place our stop+reverse to a long EUR position at 130.70 and if done, we will place our take profit + sell EUR short at 135.00. If you are neutral, then buy at break above 130.67 or sell at break below 127.86.