Yen Crosses Resuming Long Term Bear Trends

-EURJPY 5 waves down from 139.17 confirms top
-GBPJPY head and shoulders top / neckline break
-CHFJPY bearish below 89.85
-CADJPY bearish below 86.09
-AUDJPY bearish below 78.35
-NZDJPY resting above support line

Euro / Japanese Yen

From last week: “139.17 may have been the top and the count above shows why. The rally from 112.04 can be counted as an impulse in the C wave position (wave iv of the rally is a triangle). It is noteworthy that the rally stalled in the center of the former 4th wave’s price area. This is common.” The decline from 139.17 further bolsters the bearish bias because the decline is in 5 waves. The rally from 131.41 did reverse close to the price extreme of the former 4th wave so it is possible that the correction is complete. However, corrections tend to take more time than impulses and the decline from 139.17 took 18 days. As such, additional choppy action with an upward bias over the next several weeks would not be a surprise. Resistance is at 136.20.

British Pound / Japanese Yen

Fitting with the top and reversal theme, a head and shoulders top is visible in the GBPJPY. The pattern was conformed on the break of the neckline at 154.87. Favor the downside against 162.64 although price ideall remains below 159.68.

Swiss Franc / Japanese Yen

There is no change from last week’s analysis:. “There is clear momentum (RSI) divergence with CHFJPY and structural evidence of a top (thrust from triangle into a top). If this count is correct, then an important top is in place at 91.56.” Price should stay below 89.85 now.

Canadian Dollar / Japanese Yen

Last week, I wrote that “structurally, a 4th wave is expected to come to an end soon and the area of a small degree 4th wave (from October 2008) stretches to 91.00. The pair is trading at the top of a channel and the 50% of the decline from 107.23. Coming under 86.02 would suggest that at top is in place.” The CADJPY did come below there as well as the channel that had contained the rally from the early 2009 low. The downside is favored against 86.09.

Australian Dollar / Japanese Yen

I wrote last week that “the AUDJPY drop from 104.55 was a clear 5 wave affair (no labels) and the advance from 55 is corrective. Price has tested the 50% retracement of the larger decline and divergence with RSI at the top is bearish. The drop below the line extended from the 4/28 and 5/18 lows suggests that a top is in place.” There is no change other than price should now remain below 78.35.

New Zealand Dollar / Japanese Yen

RSI divergence warns of a top in the NZDJPY, which is lagging the AUDJPY. A daily close below the line extended from the 4/28 and 5/18 lows would suggest that a top is in place.

Jamie Saettele publishes Daily Technicals every weekday morning (930 am EST), COT analysis (published Monday mornings), technical analysis of currency crosses throughout the week (EUR on Tuesday, JPY on Wednesday, GBP on Thursday, AUD on Friday), and the DFX Trend Index every day after the NY close. He is also the author of Sentiment in the Forex Market.

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