The Japanese Yen crosses have reversed following corrective advances and the larger bearish trend has resumed. Despite the recent sell-off, it is probable that the declines in their early rather than late stages.
[B]
Euro / Japanese Yen[/B]
It’s all about 5s and 3s. The EURJPY decline to 124.37 was in 5 waves, indicating that the larger downtrend had most likely returned. An expected countertrend rally ended following 3 waves and the EURJPY has just now come under the 21 day SMA (in red). The minimum objective is below 124.37 and price should remain below 133.63. Much greater bearish potential, possibly below 112.00 is possible in the months ahead.
[B]
British Pound / Japanese Yen[/B]
The GBPJPY pattern is the exact same as the EURJPY pattern. The minimum objective is below 139.00 and price should stay below 149.53. The recent bout of weakness may be the beginning of the bearish leg that will end below 118.79.
[B]
Swiss Franc / Japanese Yen[/B]
The CHFJPY pattern is the exact same as the EURJPY. The minimum objective is below 82.66 and price should remain below 87.78. Ultimately, it is possible that this weakness is the beginning of the drop that will end below 88.59.
[B]
Canadian Dollar / Japanese Yen[/B]
The CADJPY is back below its 200 day SMA and is testing channel support. The overlapping nature of the rally from the January low (68.36) strongly suggests that the rally is corrective and will be therefore be fully retraced. Price should remain below 84.36.
[B]
Australian Dollar / Japanese Yen[/B]
I wrote last week that “I am expecting a top to form over the next few weeks so watch potential Fibonacci resistance at 75.84.” The AUDJPY topped at 76.20 on Monday and the probability is high that the long term downtrend has resumed. Ultimately, the objective is below 55.00. Price should remain below 75.00.
[B]
New Zealand Dollar / Japanese Yen[/B]
The NZDJPY reversed right at the origin of its 5 wave decline. The rally was relentless and expanded into a complex correction. The minimum objective is below 52.89 and price should remain below 59.38. Looking out a bit further, the drop from 60.40 may decline below 44.19.
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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