DanV
Short

USDJPY - BEARISH PULL BACK COULD BE IN PROGRESS

FX:USDJPY   U.S. Dollar/Japanese Yen
4064 50 28
USDJPY             has been like a super freight train out of control in its bullish trend . This has been so impressive that most in the trading world are now extrapolating this into the future and eyeing 124 and above.

Whilst these level might still be reached in the future there are enough reasons to expect a decent pull back to offer shorting opportunity for the following reasons:

1. Bullish sentiment is too extreme for the USD strength.
2. BOJ representatives are making the noises that YEN has weaken faster than they anticipated and possibly for their comfort.
3. Based on TA we could see that we clearly reached the extreme of the rising pitchfork that has contained the price action since 2012 low.
4. we have (from 2012 low to - May 2013             high) AB=CD (applied from June 2013             low ) measured move that coincide with recent top.
5. we have Sep - Oct             retracement swing Fib extension of 3.382% at recent high with clear RSI divergence.
6. The steep uptrend defined with narrow rising channel has been broken convincingly.
7. Recent violent drop in price could be impulsive, compared with the bounce of the spike low yesterday which has retraced 50% of the decline.

If all above holds then at least 50% -61.8% retracement of the October to recent high could be expected if not more. That would give us potential 113-110 zone

Clear lower lows have been formed on Hourly which can offer manageable stops for planning short trades.

please see further charts on shorter term below for illustrating the above.

Now it remains to be seen how the price progresses. As always do your own analysis before engaging in any trades rather than just relying on my observation.

If you like the above analysis, please don't forget to select to follow me and the chart for further updates. Indicate your likes by thumbs up and comments.

If you have alternative observations then please do let me know in constructive way with details.

Thank you for your time and for reading my analysis.

DanV
http://www.danv-charting.com
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H4 chart with details
snapshot
Reply
Nice to see my amateurish EW is rather accurate this time :D (I wouldn't dare to take trading decisions off mine though...)
Thanks for sharing Dan!
+1 Reply
DanV MOD IvanLabrie
YW. Thanks for your comments.
Reply
Hourly Chart
snapshot
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How do you feel about this Dan? http://www.forbes.com/sites/investor/2014/09/04/carry-trade-the-multi-trillion-dollar-hidden-market/

Possibly what's going on...carry trade unwind.
Reply
DanV MOD IvanLabrie
Exactly my point. Which is why I think if this change gear we could well have top both in DXY and Most Equity Market coincide with money getting repatriated. The unwinding effect could be even worse as there would be not organised exit. Some time these things can take while to play out but once engaged could be very devastating.
Reply
Indeed, might be what we are witneseeing...I took my position, let's see how it goes.
Reply
DanV MOD IvanLabrie