Elliott wave analysis of EUR/JPY and EUR/NZD for August 29 - 2013

 EUR/JPY

Today's Support and Resistance Levels:

R3: 131.37

R2: 131.04

R1: 130.56

Current Spot: 130.12

S1. 129.88

S2: 129.65

S3: 129.24

Technical Summary:

We saw a break above resistance at 130.50, but the lack of a follow-through rally could indicate, that we need one last decline to just below 129.65 before the e wave of the triangle is finally over. No matter, if we need one last decline or we are going to see a direct break above resistance at 130.56 (yesterdays high). We should soon see a new impulsive rally higher and a break above the triangle resistance-line near 132.20 for a continuation towards 139.21 as the first major upside target. However, longer term I'm looking for much higher levels closer to 170.00.

 EUR/NZD

Today's Support and Resistance Levels:

R3: 1.7168

R2: 1.7122

R1: 1.7056

Current Spot: 1.7024

S1: 1.6989 (Invalidation of my preferred count)

S2: 1.6950

S3: 1.6912 

Technical Summary:

I still think, that wave iii higher is developing. For now we have seen red wave i of iii and red wave ii of iii has bottomed at 1.6996 and I'm now looking for a break above 1.7056 as the first good indication, that red wave ii is indeed over. A break above strong short term resistance at 1.7122 will confirm, that red wave ii is over and that the powerful red wave iii of iii is developing towards at least 1.7455 and likely higher. That said, as long as minor resistance at 1.7056 protects the upside, the risk is a break below 1.6989, that would invalidate our preferred short term count (see the chart below) and tells us that wave ii is an expanded flat correction and a decline closer to 1.6912 should be seen before wave iii will be ready to take over.

To show my short term Count for red wave i and red wave ii of iii I have added an hourly chart (see above). As can be seen we are very close to the invalidation point of my preferred Count and this poses a low risk EUR-buying opportunity, as the stop can be set just below 1.6989.

It should also be noticed, that we could have a possible hidden divergence in place and if this is the case we can expect a very powerful rally in red wave iii of iii. STAY ALERT!