The pair has managed to break out of its descending wedge formation and has reached equality targets for the pattern. In approaching current price levels the pair also formed a bearish bat and allowed T1 targets to be taken, nimble traders will have closed some and moved stops to BE, or above the 0.236 on its downside breach.
Now that price has extended higher, the next area to watch for PA triggers is located at the 1.618 XA. The area also happens to be sitting near the 0.618 lvl. of the entire decline. This zone should offer a good area for initiating shorts, on weakness, for a correction lower before resuming the higher TF trend moves higher.
Shorts should be taken at key price levels in the region with a consideration that PA may extend to the 0.618. Queues should also sync with the Nikkei as the capital flows will ultimately determine whether shorts are viable or not; conversely, long positions may be taken on a topside breach of the 1.618 if price consolidates at the level before bursting higher.
Finally, as we are approaching the end of the year, it should be borne in mind that year end flows may see substantial repatriation of Yen funds by corporations. How strongly this will affect the spot market is anyone's guess, but should most certainly be taken into consideration.
GL
Now that price has extended higher, the next area to watch for PA triggers is located at the 1.618 XA. The area also happens to be sitting near the 0.618 lvl. of the entire decline. This zone should offer a good area for initiating shorts, on weakness, for a correction lower before resuming the higher TF trend moves higher.
Shorts should be taken at key price levels in the region with a consideration that PA may extend to the 0.618. Queues should also sync with the Nikkei as the capital flows will ultimately determine whether shorts are viable or not; conversely, long positions may be taken on a topside breach of the 1.618 if price consolidates at the level before bursting higher.
Finally, as we are approaching the end of the year, it should be borne in mind that year end flows may see substantial repatriation of Yen funds by corporations. How strongly this will affect the spot market is anyone's guess, but should most certainly be taken into consideration.
GL