Trade Idea: EUR/JPY – Buy at 130.80
By actionforex
Trade Idea: EUR/JPY – 132.25
Recent wave: wave 2 is unfolding as a triple threes and possibly ended at 126.95
Trend: Sideways
Original strategy :
Buy at 131.00, Target: 132.90, Stop: 130.35
New trading strategy:
Buy at 130.80, Target: 132.90, Stop: 130.15
As the single currency has eased after rising to 132.61, consolidation below there would be seen and whilst pullback to 131.20/30 cannot be ruled out, reckon 130.59 (38.2% Fibonacci retracement of 127.32-132.61) would contain downside and bring another rally later. Our bullish count remains that the retreat from 134.54 has ended at 127.32 as wave ii and consolidation with upside bias remains for further gain to 132.90/00 and later towards 133.50.
Our preferred count remains that the wave 2 from 139.26 which unfolded as a complex correction triple threes has ended at 126.95 with first set of a-b-c ended at 127.00, then x wave at 138.72, followed by second set of a-b-c at 129.02, then another x wave at 138.49 with the third set of a-b-c marked as: a-131.01, b-135.75 and the c leg as well as entire wave 2 ended at 126.95. The sharp retreat from 134.54 signals the first leg of upmove from 126.95 has ended there and wave ii has possibly ended at 127.32 and above 131.60 resistance would add credence to this view and extend gain to 133.00 and 134.00 in wave iii.
In view of this, we still prefer to buy euro on pullback. Below 130.15 would risk stronger retreat to 129.75/85 and break there would prolong choppy consolidation and weakness to 129.10/20 would follow, however, downside should be limited to 128.40/50 and support at 127.32 should continue to hold.
In the event price drops below support at 126.95, this would extend decline from 138.49 towards 125.67 (50% Fibonacci retracement of 112.08 to 139.26), however, downside is likely to be limited to next chart support at 124.39.
On the bigger picture, we are treating the rally to 169.97 as end of wave A, then followed by a selloff in wave B (abc-x-abc) at 112.08. The wave C from there should unfolding as an impulse with wave 1 of C ended at 139.26, then the 3-legged wave 2 has ended at 127.00 and wave 3 should bring retest of 139.26, then towards 142.00.
Did you enjoy this post? Why not leave a comment below and continue the conversation, or subscribe to my feed and get articles like this delivered automatically to your feed reader.
Comments
No comments yet.
Leave a comment