The drop from 168.94 is being treated as a triangle. Wave E of the triangle will end below 160.06 (and probably close to 154. E waves of triangles are usually sharp, so a bearish bias is warranted against 164.92 now.
The advance from 192.60 is wave 4 within what will probably be a 5 wave drop from 251.10. The minimum bearish objective is 1 pip below 192.60 (unless wave 5 ends as a truncation). A bearish bias is warranted against 209.31. Potential support is near 202.00/50 (this is an area where shorts may want to lighten up).
The decline from 101.85 to 92.15 is only in 3 waves but is most likely wave A of a flat. In a flat, wave B often exceeds wave A in what is termed an expanding flat. As long as price is below 102.75, we will look lower. Near term, the CHFJPY has faced strong resistance; 5 of the last 6 days’ highs were no more than 3 pips from 101.30.
We maintain that the CADJPY is headed lower longer term (the series of lower lows and lower highs inspires confidence in the bearish assessment). The bias is bearish as long as price is below 109.62 but ideally, the pair remains below last week’s high at 107.10.
The push through 100.49 changes alters our long term count but we still expect material weakness near term. The count is changed as per above (on the chart). The rally from 88.17-101.09 is in 5 waves and is either a 1st wave or A wave. Therefore, wave 2 or B is underway now towards at least 96.15 (former support and 38.2% fibo). A drop to the 61.% at 93.10 is also a possibility.
The choppy decline since the October high at 91.42 may be a series of 1st and 2nd waves. Under this count, the NZDJPY needs to remain below 88.11 for a C wave decline that will eventually come under 74.25 to remain on track. An alternate count treats the entire drop from 91.42 is an ending diagonal (similar to the EURJPY). Under this alternate, a wave 2 correction is underway towards fibo resistance in the 84/85.80 area. A rally through 88.11 would make this the preferred count. In both cases, lower prices are eventually expected. The outcome would be delayed under the alternate count.
Tell us what you think about this report: contact the strategist about the article at jsaettele@dailyfx.com
TREND ANALYSIS is based on a rolling pivot model. LONG TERM TREND is determined by the last 3 months of price data (high, low, close). SHORT TERM TREND is determined by the last 4 weeks of price data (high, low, close). R3, R2, R1, PL, PH, S1, S2, and S3 are provided to aid in identifying entries and exits. These are objective measures and our subjective analysis (STRATEGY) may differ.
SCHEDULE
Monday: EURGBP, EURCHF, EURCAD, EURAUD, EURNZD
Tuesday: EURJPY, GBPJPY, CHFJPY, CADJPY, AUDJPY, NZDJPY
Wednesday: GBPCHF, GBPCAD, GBPAUD, GBPNZD
Thursday: AUDCHF, AUDCAD, AUDNZD