FX.co ★ Elliott wave analysis of EUR/JPY for May 26, 2016

Wave summary:

Of course, we needed a false rally followed by the expected decline closer to our ideal target at 122.12 (the low seen till now has been 122.23), with a low at 122.23 our corrective target has been fulfilled and the next impulsive rally can take hold any time now. A break above yesterdays high at 123.12 will be the trigger for the expected rally higher to 124.65 and 126.47 as the next upside target. A break above the latter will confirm that a long-term bottom is in place for much more upside pressure towards 141.06 as the first major upside target.

At no point can a break below support at 121.46 be allowed as that will invalidate the bullish outlook.

Trading recommendation:

We are long EUR from 122.80 with stop placed at 121.45. If you are not long yet, then buy EUR at 122.20 or upon a break above 123.12 and use the same stop at 121.45.