CADJPY
CHFJPY
NZDJPY
[B]Commentary[/B] - Last week, we wrote, “we expect price to come under 109.94 in wave 5 before a corrective setback occurs. A bearish target is 107.47, which is the 161.8% extension of 114.33-110.97/112.91.” Price came well under this level, hitting 103.38 on Friday before reversing sharply. We are treating the rally off of the low (103.38) as a correction. The first leg of that correction is likely complete at 109.16. Near term, look for weakness until 105.59/106.95 (61.8%-38.2% of 103.38-109.16) before another rally leg takes place to complete the correction from 103.38.
[B]Strategy[/B] - Flat
[B]Commentary[/B] - We wrote last week, “look for weakness to extend towards the 100% extension of 101.85-97.54/100.25 at 95.94.” Similar to the CADJPY, the CHFJPY fell through our bearish target of 96.00 all the way to 92.15 before finding bids. Unlike the CADJPY, the CHFJPY decline does not look complete. Look for a 5th decline to unfold and register a new low (under 92.15) before a large countertrend rally takes place. The 4th wave unfolding now could take on the shape of a triangle, but the rest of the triangle would unfold at lower levels anyway.
[B]Strategy[/B] - Move to flat (profit taken at 96.00 on short)
[B]Commentary[/B] - The targets that we cited last week were hit as we wrote that “the decline should continue until the 100% extension of 97.74-89.24/92.20 at 83.70 and possibly the 161.8% extension at 78.45.” NZDJPY found bottom at 94.25. The pattern is the same as the CHFJPY. Look for more weakness from little if any above 81.01 in a 5th wave decline. After a new low is registered (below 74.25), expect a sizeable countertrend rally. The 4th wave unfolding now could take on the shape of a triangle, but the rest of the triangle would unfold at lower levels anyway.
[B]Strategy[/B] - Move to flat (bearish targets hot at 83.70 and 78.50)
[B]Written by Jamie Saettele, Technical Currency Strategist[/B]