Take a look at my last post and you’ll see the USD/JPY in a congestion pattern, a triangle, as the Dow headed lower. But alas the Dow was looking for a reason to rip.
The yen is taking a turn though, and not just a short term, intraday move.
The chart pattern on the 240 was a classic momentum set up, the bias to a downside break was based upon the Dow continuing to weaken. Today’s the Dow is up, not a lot, but the sentiment is shifting for a number of reasons. Bottom line though is that the pattern could have broken either way, and up it goes. In fact today’s price action puts the USD/JPY on the strong side of the Wave for the first time since early January.
For confirmation on the 240, here’s what to keep an eye on. The MACD Histogram went position at 4pm EST yesterday (Wednesday) and that would be the tool to confirm for a break out. You still have to wait for price to trigger the entry, but once the MACD-H goes positive in a sideways market, the trade is a pre-confirmed buy.
You can download my MT4 “GRaB” plug-in for the Wave and candle coloring here.
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