Wave marking analysis:
In the course of Friday’s trading operations the USD/JPY pair continued the formation of the inner wave structure of the prospect wave 4 in 3 (in 3 or C). Proceeding from the current wave structure we can assume that the pair is expected to test the level of the figure 84 and having defined the wave 5 in 3 will rapidly move to the lower limit of the ascending channel. At the same time it is possible that the Friday’s high is already considered as the high of the shortened wave 5. In any case the strong MACD divergence points at the necessity of more continuous and deeper correction.
Targets for the variant with the wave 5 in 3 in 3 or C:
83.84 and higher – 200.0% according to Fibonacci
Targets for the variant with a range of downside corrective waves:
83.22 – 161.8% according to Fibonacci
82.65 – 127.2% according to Fibonacci
General conclusions and trading recommendations:
At the moment the new ascending part of the trend continues its formation with the target seen at the level of figure 85 of the wave 3 or C. Proceeding from significantly shortened wave 2 or B we can define the force of the current trend and its ability for further elaboration that will result in the strengthening of American currency against Japanese, as we can actually see. The inner wave marking of the wave 3 or C indicates the possible continuation of the upward part of the trend with targets 83.84 and higher, corresponding to 200.0% of Fibonacci. The current correction within the wave 4 is not considered as too deep.
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