USDJPY Elliott channel in focus

USDJPY Elliott channel in focus

11 August 2014, 02:10
Peter Gervas
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The miserable trading conditions in USDJPY are probably explained by its long term Elliott wave position. That is, the rate has been mired in a corrective 4th wave all year. The good news is that wave 4 probably ends soon. Keep focused on the Elliott channel. The line crosses from about 100 to 100.75 for the remainder of August.


The USD/JPY pair initially fell during the course of the day on Friday, but as you can see the market did find enough buying pressure nearly 101.50 level to turn things back around and form a hammer. We are still right dead in the middle of the larger consolidation area between the 101 and 103 levels, so we are not looking for any reason to get involved at the moment. Nonetheless, we do believe that the market will ultimately go higher, and probably break out to the upside. Perhaps short-term long positions could be played, but that’s about it at this point.