Yen has reversed its intermediate and short-term trend relative to its most pairs from December, while things accelerated in its favor during the last couple weeks when US, European and Japanese markets entered a correction period and fell substantially. The oversold conditions for Yen have now been stabilised and with equity markets bouncing upward after the sharp decline, there are signs across several JPY pairs of an imminent trend reversal against JPY.
The first chart we are looking at is the daily candlestick chart that comes from 2012 and shows us the long-term upward sloping channel that current price movements have reached the lower boundaries. The entire upward move from 76 could be labeled a complete 5 wave pattern. However we also look at the alternative bullish scenario where only wave (1) of 5 is complete at 105.40 and wave (2) of 5 has ended at 100.69.
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The decline from the all time highs as shown in the following chart looks corrective as prices make an overlapping pattern and there is no clear impulsive move. The downward sloping channel is clearly shown below and taking into consideration that the decline has reached the 50% Fibonacci retracement of the rise from 96 to 105.40 there are many chances this was the end of wave (2). So we now look for impulsive wave action upwards to confirm our bullish view.
USD/JPY_2" title="USD/JPY_2" height="242" width="474">
Important short-term support for this pair is found at 101.20 as shown in the last chart below. The upward sloping pitchfork provides support at 102 and with a higher highs and higher lows pattern in the making, trend is reversing upwards.
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Important resistance for the long-term trend is the 103 price level that we should watch.
This pair has also given another short-term bullish signal and a possible intermediate low is in. Prices continue to trade inside the downward sloping channel, however an impulsive upward move is probably unfolding. Above 140 we could have confirmation of a trend change as long as prices do not fall below the 136.20 level.
EUR/JPY" title="EUR/JPY" height="242" width="474">
This is our last pair for today that has signaled a bullish trend reversal and is trending upwards. CAD/JPY has already broken out of the downward sloping trend channel. However its still too early to tell, but it looks like that bulls are giving a big fight at the boundaries of the channel.
CAD/JPY" title="CAD/JPY" height="242" width="474">
With the recent upward move from 90.75 making higher highs and higher lows, we turn bullish as long as prices do not break below 91.
CAD/JPY_2" title="CAD/JPY_2" height="242" width="474">
The upward potential for all these pairs is huge if we get confirmed that the downward move was a correction and a new upward move is at its beginnings. For more help trading FOREX become a member today. As always, thank you for taking the time to read my new post.
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