Out of upper d/t BB, hid bearish momo div
Continued to make weekly closing high. Note 40 week MA starting to turn up.
Yen has broken out from downtrend (green line) and has completed a move to target 1 from inverse head and shoulders pattern. Pullback expected to retest breakout at 83.
FXY had a great run during 2007 - 2009 crisis (credit: Ciovacco Capital Management www.ciovaccocapital.com) and now is showing sign of trend change - all over again this time?!
In my previous FXY chart, I detailed the weekly/monthly time at mode trend signals and with Tim West's help I noticed that the downtrend was expiring during August. After seeing the reaction to this event, I conclude that both FXE and FXY are reversing the longterm downtrend, judging by post pattern behavior after forming a clear bottom. This currently eludes...
The weekly index chart, with monthly MTPC overlay shows a vivid picture, that of a constantly weak yen. We are right at a longterm downtrend mode resistance from the historical high back in 2007*, and the last test of it resulted in the start of a very volatile monthly downtrend. We have this mode resistance as the first obstacle for new highs, as well as the low...
There's a monthly time at mode expiration in this instrument coming next month. It's possible to see a reaction as carry trades get unwound, but it's not clear at what price yet. The extreme target is not reached, but the time at mode one has been exceeded, and heading for 2x the projected range soon. I think the dollar rally is about to hit its expiration date,...
If price closes without retesting the mode, we might see a steep decline ensue. Entry is at market (below the previous daily low), and the stop loss at the mode. Good luck! Ivan.
"If false breakdown markets will shake more"
The Yen is sitting near an important trend line going back to late 70's. Could be near an important turning point. A break in the current downtrend similar to 90' and 98' could be the start of an extended rally in the yen. FXY is the corresponding ETF to watch.
Classic example as to why you shouldn't listen to the sell-side & mainstream media...