A figure short of our 97.96 target, prices have corrected to the previous consolidation. From an Elliott perspective, $JPY is in a Wave IV correction to contrast the Wave II pullback from Sept. 2012. The guideline of alternation suggests that this correction will be more time consuming and could follow the path of a triangle. (c1) S/t, the a-b-c sell-off from the highs has already satisfied a complete correction but since 4th waves are often time consuming a range bound market over the next week is our base case. Downside support is now the key pivot at 93.60 and uptrend support from Jan and Nov comes in to play at 92.75. Resistance is 95.22/45, the opening gap and latest breakdown level. This 93.60/95.45 zone is expected to contain prices near-term.(c2) Levels: Support – 94.31, 93.60, 92.75 Resistance – 95.22, 95.45, 96.50
Nomura