The article covers the following subjects:
Major Takeaways
- Main scenario: After the correction ends, consider short positions below the level of 161.64 with a target of 138.08 – 131.25. A sell signal: the price holds below 161.64. Stop Loss: above 162, Take Profit: 138.08 – 131.25.
- Alternative scenario: Breakout and consolidation above the level of 161.64 will allow the pair to continue rising to the levels of 165.00 – 170.00. A buy signal: the level of 161.64 is broken to the upside. Stop Loss: below 161.30, Take Profit: 165.00 – 170.00.
Main Scenario
Consider short positions below the level of 161.64 with a target of 138.08 – 131.25 once the correction is completed.
Alternative Scenario
Breakout and consolidation above the level of 161.64 will allow the pair to continue rising to the levels of 165.00 – 170.00.
Analysis
The ascending wave of larger degree 3 has presumably finished developing on the daily chart, with wave (5) of 3 formed as its part. On the H4 chart, a descending correction is developing as the fourth wave of larger degree 4, within which wave (А) of 4 is formed and a local corrective wave (В) of 4 is nearing completion. Apparently, wave С of (В) is nearing completion on the H1 chart, within which the fifth wave of smaller degree v of C is coming to an end. Upon its completion, if this assumption is correct, the USDJPY pair will continue to decline to 138.08 – 131.25 in wave (С) of 4. The level of 161.64 is critical in this scenario as a breakout will enable the pair to continue rising to the levels of 165.00 – 170.00.
Price chart of USDJPY in real time mode
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