FX.co ★ Elliott wave analysis of EUR/JPY for February 10, 2016

Wave summary:

Wave ii bottomed at 128.25 (just below our target at 128.55). A rally from a low of 128.25 looks impulsive, but to confirm that a new impulsive rally is developing we should ideally see support in the area of 128.85 - 129.01 protecting the downside for a new rally above yesterday's high of 130.26 and more importantly a breakout above 131.66. The movement above the latter, will break the resistance line from 141.04 and will confirm the impulsive rally in wave iii higher to above 141.04 towards 149.52.

Only an unexpected breakout below a low of 128.25 will invalidate the bullish count and call for a new test of strong support in the area around 126.05 - 126.14.

Trading recommendation:

We are long EUR from 128.60 and will move our stop higher to 128.20. If you are not long EUR yet, then buy near 128.85 and use the same stop at 128.20.