Elliott Wave Analysis: Triangle On USDJPY Points To Lower Levels

By: Gregor Horvat | Tue, Oct 18, 2016
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USDJPY is trading higher for the last few weeks, and it finally broke above 104.34 swing so it appears that wave four correction since June is going to be more complex and longer in time. An updated wave count shows wave C) up from August that can still be part of a triangle formation which means that price can turn lower later this month for wave D), towards the lower side of a triangle range as shown on the 4h chart. If we are correct, then top for wave C) should be found around 104.50/105.00 area.

USDJPY, 4H

USD/JPY 4-Hour Chart

A Triangle is a common 5 wave pattern labeled A-B-C-D-E that moves counter-trend and is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide 3-3-3-3-3.

Basic Triangle Correction:

Idealized Basic Triangle Correction

 


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Gregor Horvat

Author: Gregor Horvat

Gregor Horvat
www.ew-forecast.com

Gregor Horvat

Gregor Horvat, based in Slovenia, has been in the forex markets since 2003. He is a technical analyst and individual trader who has worked for Capital Forex Group and TheLFB.com. He also is founder of forex services on www.ew-forecast.com. EW-Forecast.com provides technical analysis of the financial markets, highlighting behavioral patterns based on the Elliott Wave Principle (EWP). Website: http://www.ew-forecast.com/

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