USDJPY is strongly bearish as the Dollar falls further. The following 24 July USDJPY Elliott wave analysis looks at what could happen based on Elliott wave theory.
USDJPY rallied yesterday after a fast drop last week. Price is currently at the 110.9-111.5 intraday price zone. It’s expected that the current price drop should break below this zone as the currency pair hits lower prices. In the last update, we analyzed the drop from 113.2 as a bearish impulse wave. We expected the 3rd sub-wave of this impulse wave to hit below the intraday 110.9-111.5 zone. The chart below was used in the last update.
The drop from 113.2 is impulsive. Price is making probably the 4th sub-wave of iii at the support zone. Price is expected to break below the zone down to 110 to complete the impulse wave dip. At the end of this, we would expect a bullish correction before price goes further downside. On a bigger scale, we would be looking at a bearish impulse wave or a bearish zigzag corrective pattern (or any other corrective pattern). If price works with this forecast, we should expect USDJPY dip to 108 in the next couple of weeks.
24 July USDJPY Elliott wave analysis: what next?
The rally yesterday was higher than we expect for the last update. The chart above is the new update which is more preferred. The wave count in the last update can be the alternative. The two scenarios point downside. Once price breaks below 110.9, we would be expecting it at 110.2 or lower at 110 handle. At the end of the bearish impulse wave, we would be expecting a bullish correction upside. Stay tuned for the next update.
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