- 1H: A little recap first; USD/JPY bounced from 87, but fell after testing 89. The market is supported here above 86.26, but I suspect some further decline towards 85.30 area, as noted in the weekly update.
- On the 19th, it appeared that the market was going to continue lower to 86 area after a negative reversal, but this did not materialize. Instead, the market continued to consolidate, in an upwards channel. - Counting the waves, I have counted a, b, c, and d or x waves, which means there should be at least 1 more wave up before completing this consolidation pattern.
- A swing projection, which is supported by a positive reversal, points to 87.70. A positive reversal occurs when the RSI low is lower, but the price low is higher.
- The 50% retracement and SMA200 will also likely reside around 87.70 as well, so this is a logical level of resistance.
- From here, we may start considering continuation of the bearish attempt mode.
Fan Yang Currency Analyst Commodity Trading Advisor
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