Pound/yen is developing wave C of the daily downtrend, colored royal blue in the chart. Within this wave there's a set of A-B-C waves of smaller degree, colored magenta, with wave C developing. At this moment the targets below the current price are Fibonacci expansions off the daily waves A-B - 135.03-130.78-132.93, and expansions off minor waves 132.93-129.98-131.06, 131.06-129.87-130.99, and 130.99-130.27-130.72.
Supports:
- 129.80 = objective point (OP)
- 129.56 = expanded objective point (XOP)
- 129.24 = contracted objective point (COP)
- 129.26 = XOP
- 128.84 = super expanded objective point (SXOP)
- 128.68 = OP
In case the price reverses up for a corrective wave the nearest resistances will be Fibonacci retracements of the downwave starting from 131.06 - wave not yet developed.
Overbought/Oversold
The Detrended Oscillator is in the oversold area, which means it's time to wait for a retracement to enter short. Assuming that the prevailing trend is down it's preferable to wait for a recovery to a Fibonacci resistance or when the oscillator gets back above the zero level - 30 pips to go.
Read more on how to apply Fibonacci studies to calculate price targets.
