Despite a big gap down on USDJPY, the pair remains in bullish mode as the decline is actually still in a three wave pattern, which we think it’s wave (iv).
Notice that wave (iv) is actually testing some interesting levels around 94.30, where we can see an upper line of a base channel as well as a 38.2% retracement level compared to wave (iii).
With that said, the pair could continue higher in this week, but we need to keep a close eye on the 95.44 level. An overlap will confirm the bullish case. Why? Because in such case decline from the top would be a completed three wave fall which is a corrective structure.
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