Trade Idea: EUR/JPY - Stopped profit and stand aside

EUR/JPY – 116.94

Recent wave: wave v of (C) ended at 94.12 and major correction in wave A has ended at 149.79

Trend: Sideways

Original strategy:

Bought at 115.85, stopped profit at 116.40

Position: – Long at 115.85
Target:  –
Stop: – 116.40

New strategy :

Stand aside

Position: –
Target:  –
Stop:-

As the single currency retreated after rising to 117.49 yesterday, suggesting consolidation below this level would be seen and test of intra-day support at 116.25 cannot be ruled out, break there would suggest top is possibly formed, bring retracement of recent rise to 115.80-85, then towards previous support at 115.31 which is likely to hold from here.

On the upside, above said resistance at 117.49 would revive bullishness for recent erratic upmove from 112.08 to extend further gain to 117.80-85 and then 118.00-10, however, overbought condition should prevent sharp move beyond 118.50, risk from there has increased for a retreat later. 

Our latest preferred count is that wave (ii) is ABC-X-ABC which ended at 123.33 and wave (iii) is unfolding with wave iii ended at 100.77, followed by wave iv at 111.57 and wave v as well as the wave (iii) has ended at 97.04, followed by wave (iv) at 111.43 and wave (v) has ended at 94.12 which is also the end of the larger degree v, this also implied the major wave (C) has also ended there, hence major correction has commenced from there with (A) leg unfolding in its lower degree wave c which has possibly ended at 145.69. Under this count, A-B-C wave (B) has commenced with A leg ended at 136.23, wave B at 143.79 and wave C has possibly ended at 149.79.

Our larger degree count is that the decline from 139.26 is wave (C) and is sub-divided into a diagonal triangle i-ii-iii-iv-v with wave i – 105.44, wave ii- 123.33, wave iii – 97.03, wave iv – 111.43, followed by the final wave v as well as the end of wave (C) at 94.12, this also mark the bottom of larger degree wave B. Under this count, major rise in wave C has commenced as an impulsive wave with minor wave III ended at 145.69, wave V is still in progress for further gain to 150.00. Having said that, this so-called wave V could well be the first leg of larger degree 5-waver wave C and this wave C should bring at least a retest of wave A top at 169.97 (July 2008).

Trade Idea: EUR/JPY - Stopped profit and stand aside