Friday, January 29, 2010

USD/JPY 500 Pip Rally

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This position is risky for 2 reasons.

1) Weakening stock market could drag USD/JPY lower.
2) It is possible that wave 4 has already been completed, thus no additional wave C of 4 is required.

$95.36 is the long term target for the forecasted rally. From the most recent USD/JPY low, wave count would indicate that this rally is corrective in nature. The only wave formation up for discussion is whether the decline from the 50% retracement has been wave 5 lower OR an X wave. If it is an X wave then this corrective rally is expected to extend further up to 95.36

a-b-c (A), >Completed at 50% retracement<
X, >Completed at 89.12<
a,b,c (C) >Began 27/01/2010<

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