• 287 days Will The ECB Continue To Hike Rates?
  • 287 days Forbes: Aramco Remains Largest Company In The Middle East
  • 289 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 689 days Could Crypto Overtake Traditional Investment?
  • 694 days Americans Still Quitting Jobs At Record Pace
  • 696 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 699 days Is The Dollar Too Strong?
  • 699 days Big Tech Disappoints Investors on Earnings Calls
  • 700 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 702 days China Is Quietly Trying To Distance Itself From Russia
  • 702 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 706 days Crypto Investors Won Big In 2021
  • 706 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 707 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 709 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 710 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 713 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 714 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 714 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 716 days Are NFTs About To Take Over Gaming?
Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Trading On The Mark

Trading On The Mark

Trading On The Mark

Our work is grounded in several technical methods. We make use of Elliott Wave, Gann techniques, Fibonacci relationships in price and time, cycles, and other…

Contact Author

  1. Home
  2. Markets
  3. Other

Yen May Be Easiest Of Upcoming Currency Trades

Successful trading doesn't require that you know where the market will go. It depends a great deal more on recognizing high-probability set-ups, where entries are optimal and the risk of loss is well defined (and hopefully small). That's why the current picture of the Dollar/Yen market is such a gift. The consolidation pattern that has lasted through the spring and summer appears nearly complete, and the currency pair is poised to break out in what should be a strong move. There's also a clear line to indicate where the trade would be wrong, thus defining the risk.

Beginning just a few days after the October 2011 high in the Yen, we have charted and traded its progress downward. The monthly chart below shows how the powerful downward wave of 2012-13 halted when it first found support at the edge of the channel. That also coincided with the beginning of upward cyclical pressure. After it found support, then Yen moved into what appears to be a triangle pattern, which typically (but not always) breaks in favor of the continuation trade. The next phase in the 11-month cycle also favors continued downward movement.

Yen Futures - Monthly Chart

The triangle is easier to see on the weekly chart. If it is going to behave as an Elliott Wave triangle and break downward, then the current advance labeled as wave 'e' cannot exceed the previous high labeled as wave 'c'. This chart is an excellent example of why triangle trades can present the best opportunities for optimal entry and placement of stops.

Note also that the commodity channel index at the bottom of the weekly chart is testing the zero-line from below. The indicator is confirming that the present area as a decision point. If the indicator were to pull away from the zero-line, it would support the bearish continuation scenario.

Initial targets lower would include 0.009575 and 0.009082. We will update those targets as new information comes in. For a close-up view of the possible ending wave of the triangle, its retrace levels and lines of resistance, we will post updated charts of daily bars on our website.

Yen Futures - Weekly Chart

 


This article originally appeared at Trading On The Mark.

 

Back to homepage

Leave a comment

Leave a comment