Several months ago (March 04th, 2014), this $JPY was sitting at 102.2 when the predictiive/forecasting model released two target that eventually got hit - Replay the price action here: .
Today, I would like to make a case for a similar lofty, long-term call with an intermediate unwinding to the downside first, as to provide price with the necessary technical springboard before its ascension to a potential historical high.
For now, the downside target is purely Fibonacci-based, seeking a relative to the recent upswing. Playing out this approximate scenario, the predictive/forecasting model was able to define a lofty target as well. But first, let's talk about the technical reasons behind the moves, before we define the targets per se:
TECHNICAL RATIONALE - Using Weekly Chart
(Link to Weekly Chart: )
1 - Price has rallied sustainably until now. In fact, a simple analysis should easily demonstrate that recent ascension was built on the back of a FIRST WAVE EXTENSION, now arriving at a consolidation pattern, knows to the Elliotician as an Ending Triangle.
2 - In the more general view of the chart, one can also appreciate that price has approached historical price clusters to its left of the MONTHLY price field, which define prior support turned resistance as of now. In order to define that level, one may turn to Fibonacci's lowest acceptable 38.2% as far as building a geometric pattern fro which to propulse future price action.
3 - A proprietary pattern ("Janus Pattern") sees a support as low as 88.989 - While this prop pattern cannot be shared, I will simply announce it here as a way to established the LOWEST possible retracement in that WEKLY chart - Link provided above.
4 - Now, looking at the last and loftiest target, we will consider that this Weekly chart is in the process of defining an WAVE's Flat, whose skeletal anatomy demands a 3-3-5 structure, to define Waves A, B and C, respectively. As we just discussed about a retracement to a significant low, one may now assume that this forecast low would become a basis for a rise paced in a 5-wave fashion to define the final Point-C of this flat. See Monthly flat to appreciate the relative positions of Points A and C, each born out of waves as per EWP rules, where A represents an upwards correction of 3-wave structure, B a 3-wave ipsi-directional to major trend, and C an expected 5-wave structure.
All rationale above yielded the following targets, written in the order of expected price action development:
1 - TG-Hi = 109.786 - 12 SEP 2014
2 - TG-Lo = 88.989 - JANUS PATTERN - 12 SEP 2014
3 - TGx = 152 .073 - 12 SEP 2014
Note that SPX and $USDJPY are well correlated, and that this analysis in the most immediate term reflects a similar upturn of e-Mini S&P500 ES, just posted today - See that analysis here:
As I post this, please allow me the time to also post other pertinent timeframes to put the entire analysis in its proper context.
Predictive Analysis & Forecasting
Denver, Colorado - USA
Alias: 4xForecaster (Twitter, LinkedIn, StockTwits)
Signal Service or Private Course - Contact: MarketPredictiveAnalysis@gmail.com
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$USDJPY - MONTHLY Chart:
$USDJPY - WEEKLY Chart:
$USDJPY - DAILY Chart:
CORRELATED VIEW WITH e-Mini S&P500 - M5
(This is a very small timeframe, but the gist is to demonstrate that price will likely be propelled to open the market at a high, as per expected in $USDJPY)
The series of charts are showing that $USDJPY is not done rising. In fact, considering its positive correlation with $SPX, and since $SPX is about to rise again, then $USDJPY is expected to rise as well.
However, as the expectation is for $USDJPY to rise, it will be capped by strong technical hurdles, such as a long-term upper border of a downtrend channel.
When trying to define what that value might be, I used the model to define it. The model comes up with 109.786, which corresponds very well with the trendline overhead.
NEXT, if and once that price increase up to 109.786 is done, I would expect a reversal to much lower values. Here too, looking at what the lower value could be, the model defined it as 88.989.
Turns out that 88.989 corresponds to a proprietary pattern completion level (Janus Pattern), as well as the support of an inner channel which also has a long-term validation.
All these are mere speculations of course, but ones that have a direct correlation with predictive model and proprietary pattern, and most important, it maintains a verifiable correlation via physical resistance and support levels, as those provided by the long-term channels.
Being speculations, they may or may not occur, but this exercise is to highlight how to may something concrete out of abstractions, when the trader is facing a potential trade opportunity, and handles/hurdles have to be defined - sort of walking in the dark with a hand scanning on both sides and up-front, looking for ways to define what could be palpated and used to ambulate forward.
$USDJPY remains expectant of several unanswered overhead targets @ 109.786
via @tradingview $JPY #BOJ $USD #Forex
So still need to be extremely carefull with shorting USDJPY. It has broken multiple layers of resistance with ease and fundamentally there is no real reason for a correction. Yellen may be less hawkish then expected, but Japanse macro's and economy are getting wrose with the time. BoJ mentioned to be willing to ease more and even bought bonds with negative return recently.
In the larger scheme of things, this is where it belongs in terms of the Model's probable price pathway:
And finally, this monthly chart that provides a larger perspective of geometries at play:
$USDJPY hit target @ 109.786; Wolfe Waves Pattern pending at 5'; Then, major correction?
@tradingview | $USD $JPY
Also, consider these recent $USDJPY analyses with same forecast:
1 - $JPY Hit Forecast TG @ 107.509; Eyes TG-Hi @ 109.786 | #forex:
2 - $JPY Nears Target-High @ 106.614 | $USD $JPY #Yen #Nikkei #forex:
1 - TG-Hi = 109.162 got hit, but failed to act as reversal
2 - Reversal failure at TG-Hi calls for a "Worst-Case scenario", defining TG-x @ 116.162
3 - Background geometry highlights forceful bearish strength in rare 5-second attainment
As you may recall, a recent analysis left the directional bias to "Neutral", concluding that a directional commitment had yet to be declared (See analysis and conclusion in this link: ).
At this point, we are nearing a significant resistance. The original reversal level was defined within this original chart as:
- TG-Hi = 109.786 - 12 SEP 2014
This level has since been reached, and price clung to the high as of the close of this past trading week.
You may also recall that a 38.3-Fibonacci retracement was expected to occur, offering price a structural respite level before a potential resumption to higher highs.
While the gist of price action remains probable along these lines, I have resubmitted the data to the predictive/forecasting model, considering the significant surpassing of TG-Hi, and the bulls' resilience. Based on a "Worst-Case Scenario", the predictive/forecasting model has thus refined its nominal target as follows:
- TG-x = 116.162 - 02 NOV 2014
A potential background pattern in the form of a Bill Wolfe's Wolfe Waves Pattern ("WW") is overlaid to offer a geometric context in support of the model's target. As you may recall in prior description of WW, Point-5' ("Point-5 prime") tends to impose the most common level of reversal, followed by Point-5, and on rarest occasion, Point-5" ("Point-5 second"). The latter would most often be associated with an aggressive directional force (here, an aggressively bullish market). In fact, as the chart below illustrates, the 5' position was faked out by a near-hit, followed by a faked-out reversal. Instead, price rallied on up to a level higher than 5 or 5' - In the context of WW, one has to suspect that a 5" target will possibly be the next level of geometric attraction.
In the context of our "Worst-Case Scenario", where the predictive/forecasting model defines the least probable outlier value defined by TG-x (here equaling 116.162), there is added reason to believe that such 5-second level could be attained.
For the time being, the lower timeframes are screaming for a relaxation in price, in the form of an interim limited price decline. Here again, this price decline is illustrated as a speculative YELLOW arrow in the chart below.
Price rose to higher levels than the model's nominal TG-Hi. Once this occurs, the analysis is called to higher levels of consideration in terms of timeframe, as this is often associated with heavier players interfering with smaller-degree timeframes.
This called for the re-definition of a worst-case scenario based on outlier predictive/forecasting model's values using a higher timeframe. The result is the chart below.
Posted on Twitter as:
"$USDJPY eyes 116.162 following shallow retracement:
via @tradingview | $USD $JPY #BOE #nikkei #forex "
$USDJPY coming to significant forecast level at 116.162:
via @tradingview | $USD $JPY $ES $SPX $SPY #forex
If 114.949 holds, further price decline might occur below structure @ 113.847 - See M15 chart below:
The interest here is the resolution of this Wolfe Waves pattern (see DAILY chart below), where the expectation is bearish, as pattern strains price towards its 1-4 "Take-Profit" Line:
$USDJPY nears 116.162 target; Hig-probability reversal:
via @tradingview | $USD $JPY $ES $SPX #BOJ #forex
$USDJPY fell short of 117.114 target; WW pattern contemplates 1-4 Profit Line:
via @tradingview | $USD $JPY #forex