Pound/yen is moving up in impulse wave C of the medium term uptrend – colored magenta in the chart. within this wave there’s also a set of subwaves with wave C developing – colored red. On smaller timeframes all the subwaves are also impulsive – wave 5 (orange red) and wave C (yellow).
The targets of the advance are Fibonacci retracements of 135.03-126.43, and expansions off 126.43-129.58-127.96, 127.96-130.32-128.87, 128.95-131.24-130.10, 130.10-131.49-131.01.
– 131.74 = .618 retracement (!)
– 131.87 = contracted objective point (COP)
– 132.39-40 = confluence area of two objective points (OP)
– 132.69 = expanded objective point (XOP)
In case the price referses downfor a correction the immediate supports will be Fibonacci retracements of 130.10-131.71.
– 131.09 = .382 ret
– 130.91 = .50 ret
– 130.72 = .618 ret
The Detrended Oscillator is below the zero line, confirming the corrective wave. Assuming that the prevailing trend is up, it’s preferable to open longs on any weakness – particularly when the price hits a Fibonacci support (.50 or .618) or gets into the oversold – 15-25 pips to go.
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