Commentary: We wrote yesterday that “if the decline from 117.93 unfolds in 5 waves, then we will look to get bearish on the pullback.” A 5 wave decline may have unfolded but the decline could also be a correction within larger wave C.
The USDJPY is fairly close to the 61.8% of the 117.93-116.17 decline but the rally off of the low is sharp (doesn’t look corrective). If a decline unfolds in 3 waves and ends near 116.71, then look to buy for the next leg up. A break of 116.17 favors the bearish scenario.
Strategy: Flat