Wave marking analysis:
As it was expected, during the yesterday’s trades the USD/JPY pair continued the formation of the inner wave structure of the wave C of the whole downside correction that has been developing since March 21. In the afternoon the pair decreased by almost 90 basis points. Despite the significant price rebound from the reached high, the inner wave structure of the wave C still looks as not completed. If that proves to be so, then the descending movement is likely to continue towards the correction level 76.4% (81.40) that corresponds to the equality of waves A and C of the whole current corrective structure. At the same time it is necessary to consider the MACD divergence, as it indicates that the formation of the upward trend can be resumed anytime.
Targets for the variant with the wave 4 in 3 or C:
81.91 – 61.8% according to Fibonacci
81.40 – 76.4% according to Fibonacci
Targets for the variant with wave 5 in 3 or C:
83.26 – 23.6% according to Fibonacci
83.69 – 11.4% according to Fibonacci
General conclusions and trading recommendations:
At the moment the uprising part of the trend continues its formation with targets seen at the level of figure 85. Presently we can observe the descending movement within the wave 4 of the global uprising trend. The current correction within the wave 4 has 81.91 and 81.40 as downside targets which are equal to 61.8% and 76.4% of Fibonacci. The downside impulse is likely to be seen within the wave 4 in C (which is not fully formed yet). The resumption of the descending part of the trend will take place when the whole wave 4 is developed.
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