Commentary: Last week, we wrote that “As long as price is below 110.58, the favored count places the pair in wave iii of 5. There are objectives concentrated in the 108.00-108.50 range, which is fairly close. JPY pairs though have a tendency to extend in 5th waves so lower levels (and quickly) are a very real possibility.
In fact, within the 5 wave bear cycle from 124.13, wave 5 would equal wave 1 at 107.07.” Wave 3 within the bear cycle from 111.74 ended at 107.54 and the bounce to 108.76 may have completed wave 4. One more low is expected before a larger recovery. A drop below 107.54 may also complete a 5 wave decline from 124.13.
Strategy:Flat