FX.co ★ Elliott wave analysis of EUR/JPY for February 12, 2016

Wave summary:

A breakout below important support at 126.14 told us that the corrective decline is still unfolding. The decline from 141.04 has turned onto a very complex triple zig-zag correction and we are now in the final zig-zag correction towards 119.90 over coming weeks.

As two other corrections were pretty hard to read, we should expect the same this time. However, it seems to be a common feature between the first wave of the zig-zag pattern and that is the support line which was tested twice and if this is the case here too we should see another decline closer to 125.00 before wave b takes over for a rally back to the resistance line.

Trading recommendation:

We bought EUR at 126.10 and hit the stop+revers at 126.10. So now we are short EUR from 126.10 looking for an opportunity to take profit near 125.00.