GBP/JPY 144M chart with an analysis of the key levels
1. Elliott Wave Analysis and Structure
The chart appears to be tracking a complex Elliott Wave pattern with clear labeling of impulse and corrective waves.
Wave III and IV are prominent on the chart, indicating that the current movement may be within a broader impulse wave structure, likely aiming towards completing Wave V at higher levels.
Wave 1 Invalidation Level at 199.240: This level is crucial as any move below this would invalidate the current wave count, which expects price to rise in Wave V without dipping below Wave 1's territory.
2. Fibonacci Levels and Extensions
Key Fibonacci Extensions:
3.618 Extension at 207.390: This is the highest extension marked, suggesting a potential overextended Wave V target.
2.618 Extension at 205.421: This level is marked for a diagonal Wave 5, providing a likely resistance level and a target for a possible reversal.
2.236 Extension at 203.952: Labeled as "Volume Divergence by Wave 5," this level indicates where volume divergence might emerge, signaling weakening momentum and a potential reversal.
Retracement Levels:
0.272 (202.172) and 0.382 (201.240): These retracement levels provide support within the corrective structure of Wave IV. They mark areas where price could potentially consolidate before moving higher to complete Wave V.
0.618 (199.240): This level is noted as a critical support level. It also serves as the Wave 1 invalidation point, reinforcing its importance as a support that should hold if the bullish wave count remains valid.
3. Volume Divergence and Inducement Zones
Volume Divergence by Wave 5 (at 206.888): Located near a significant Fibonacci extension, this indicates that although price may continue higher, a reduction in volume could hint at a weakening bullish momentum.
Inducement Zone (2.618 at 204.375 for Wave 3): This inducement area acts as a potential target for Wave 3, where traders might look for an initial breakout or reaction as it aligns with a higher extension level.
Conformation Zone at 2.236 (203.224): Marked as a confirmation area for Wave 1-5, suggesting that this could act as a validation zone for continued bullish movement if price holds above it.
4. Invalidation Levels
Wave 2-B Invalidation: An invalidation level is noted around the bottom of the corrective phase, signifying that any drop below this would invalidate the expected bullish move in Wave V.
Wave 4 Invalidation: The corrective Wave IV must not extend too low (below the noted retracement levels), or else the structure may shift into a deeper correction rather than maintaining the bullish outlook.
5. Strategic Price Levels
Resistance Levels:
206.889: This is noted as the invalidation extension above Wave 5, marking a potential high where price might encounter resistance if this wave structure remains intact.
205.421 (Diagonal Wave 5 Target): As a common extension level, this serves as a natural target for price to complete the wave.
Support Levels:
200.500 - 201.240 Range: This range includes retracement levels for Wave IV and is a key support area to maintain the bullish wave count.
199.240: Critical as the must-not-pass level for Wave 1. A breach here would invalidate the wave structure.
6. Channel and Trendline Analysis
Ascending Trendline Support: An orange trendline runs diagonally, acting as a support line for the ongoing uptrend. This line aligns with retracement levels, suggesting that if price touches or respects this trendline, it could provide a buying opportunity within the context of the bullish structure.
Diagonal Channel in Purple: The price movement within this channel helps in tracking the upward progress of Wave III to Wave V, with each retracement bouncing within the channel limits.
7. Projected Path and Trading Implications
Primary Pathway: The chart anticipates that price will reach the 2.618 (204.375) and possibly 3.618 (207.390) extensions for Wave V. A break of these levels with volume divergence would be a signal for potential exhaustion.
Wave IV Consolidation: Should Wave IV continue, traders may look to buy on dips near the 0.382 (201.240) or higher as long as the price remains above 199.240.
Exit/Profit-Taking Zones: Traders may consider taking profits near 204.375 or 206.888 based on resistance levels, especially if volume divergence becomes apparent.
Summary of Key Takeaways
Upside Targets: The key upside targets are the 2.236 extension (203.952), 2.618 extension (205.421), and the maximum extension at 207.390.
Critical Supports: Supports at 201.240 (0.382 retracement) and 199.240 (Wave 1 invalidation) are key for maintaining the bullish outlook.
Volume Divergence: Potential volume divergence near the higher extensions could signal a weakening trend, marking a potential reversal or consolidation phase for GBP/JPY.
The chart appears to be tracking a complex Elliott Wave pattern with clear labeling of impulse and corrective waves.
Wave III and IV are prominent on the chart, indicating that the current movement may be within a broader impulse wave structure, likely aiming towards completing Wave V at higher levels.
Wave 1 Invalidation Level at 199.240: This level is crucial as any move below this would invalidate the current wave count, which expects price to rise in Wave V without dipping below Wave 1's territory.
2. Fibonacci Levels and Extensions
Key Fibonacci Extensions:
3.618 Extension at 207.390: This is the highest extension marked, suggesting a potential overextended Wave V target.
2.618 Extension at 205.421: This level is marked for a diagonal Wave 5, providing a likely resistance level and a target for a possible reversal.
2.236 Extension at 203.952: Labeled as "Volume Divergence by Wave 5," this level indicates where volume divergence might emerge, signaling weakening momentum and a potential reversal.
Retracement Levels:
0.272 (202.172) and 0.382 (201.240): These retracement levels provide support within the corrective structure of Wave IV. They mark areas where price could potentially consolidate before moving higher to complete Wave V.
0.618 (199.240): This level is noted as a critical support level. It also serves as the Wave 1 invalidation point, reinforcing its importance as a support that should hold if the bullish wave count remains valid.
3. Volume Divergence and Inducement Zones
Volume Divergence by Wave 5 (at 206.888): Located near a significant Fibonacci extension, this indicates that although price may continue higher, a reduction in volume could hint at a weakening bullish momentum.
Inducement Zone (2.618 at 204.375 for Wave 3): This inducement area acts as a potential target for Wave 3, where traders might look for an initial breakout or reaction as it aligns with a higher extension level.
Conformation Zone at 2.236 (203.224): Marked as a confirmation area for Wave 1-5, suggesting that this could act as a validation zone for continued bullish movement if price holds above it.
4. Invalidation Levels
Wave 2-B Invalidation: An invalidation level is noted around the bottom of the corrective phase, signifying that any drop below this would invalidate the expected bullish move in Wave V.
Wave 4 Invalidation: The corrective Wave IV must not extend too low (below the noted retracement levels), or else the structure may shift into a deeper correction rather than maintaining the bullish outlook.
5. Strategic Price Levels
Resistance Levels:
206.889: This is noted as the invalidation extension above Wave 5, marking a potential high where price might encounter resistance if this wave structure remains intact.
205.421 (Diagonal Wave 5 Target): As a common extension level, this serves as a natural target for price to complete the wave.
Support Levels:
200.500 - 201.240 Range: This range includes retracement levels for Wave IV and is a key support area to maintain the bullish wave count.
199.240: Critical as the must-not-pass level for Wave 1. A breach here would invalidate the wave structure.
6. Channel and Trendline Analysis
Ascending Trendline Support: An orange trendline runs diagonally, acting as a support line for the ongoing uptrend. This line aligns with retracement levels, suggesting that if price touches or respects this trendline, it could provide a buying opportunity within the context of the bullish structure.
Diagonal Channel in Purple: The price movement within this channel helps in tracking the upward progress of Wave III to Wave V, with each retracement bouncing within the channel limits.
7. Projected Path and Trading Implications
Primary Pathway: The chart anticipates that price will reach the 2.618 (204.375) and possibly 3.618 (207.390) extensions for Wave V. A break of these levels with volume divergence would be a signal for potential exhaustion.
Wave IV Consolidation: Should Wave IV continue, traders may look to buy on dips near the 0.382 (201.240) or higher as long as the price remains above 199.240.
Exit/Profit-Taking Zones: Traders may consider taking profits near 204.375 or 206.888 based on resistance levels, especially if volume divergence becomes apparent.
Summary of Key Takeaways
Upside Targets: The key upside targets are the 2.236 extension (203.952), 2.618 extension (205.421), and the maximum extension at 207.390.
Critical Supports: Supports at 201.240 (0.382 retracement) and 199.240 (Wave 1 invalidation) are key for maintaining the bullish outlook.
Volume Divergence: Potential volume divergence near the higher extensions could signal a weakening trend, marking a potential reversal or consolidation phase for GBP/JPY.
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Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.