Japanese Yen Stalls Below 124.00

[B]Commentary[/B]: “It is our working assumption that the USDJPY is working higher in a C wave towards the 128.00 area over the next few weeks/month. The 78.6% of 135.13-101.67, the 100% extension of 108.98-122.17/115.14, and the 100% extension of 101.67-121.39/108.98 are between 127.97 and 128.70.”

We wrote yesterday that “near term, 122.82-123.30 should provide solid support.” The USDJPY slipped to 123.09 yesterday in a 4th wave and the current rally is most likely a 5th wave that will not extend much beyond 123.73 (might already be complete at 123.74). We expect a decline near term to correct the ‘5 up? from 120.75, so now is not the time to position for a run to 128.00. [B]Strategy[/B]: Move to flat, we?ll look to return to the bull side on a correction of the 5 wave rally from 120.75.