Elliott wave Analysis: USDJPY and GOLD Update
On the USDJPY we are looking at a higher degree wave A in play, which is a motive wave, and thus must be structured by five sub-waves. We can see that price made a nice leg up last week from 110.67 area, where corrective wave 4) had ended, and now final wave 5) is in play, which can look for a top and resistance near the Fibonacci ratio of 61.8 and 261.8; at 112.20-113.20 area. A later drop in impulsive fashion back below 110.70 would indicate a complete wave five.
Strong reversal down on gold from 1346, and accelerating price decline through 1316 on Friday, suggests that market is in bearish mode and that more weakness can be coming as this looks like a wave 3) in progress. Ideally, this is an early stage of a higher degree decline so be aware of more weakness after a fourth (4) wave bounce, which can look for resistance and a bearish reversal around the 1295/1300 region.
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