for those that have been following my posts over the days, weeks and years you know that I try (operative word) to look for patterns that allow for risk controlled entries into and out of the market.
I also like to use the classic CMT world of intermarket analysis to look at ‘other’ markets to understand correlations and how they may affect each other from a bull or a bear perspective.
I’m also neither a bull or a bear. I’m a PATTERN dude. period.
Sometimes the patterns work, sometimes they don’t. they allow one to know where they are are wrong … the key to surviving this investment game.
from a correlations perspective, it is widely known that the USD JPY is a good proxy to look at for equity health or sickness. when the JPY strengthens it’s usually a risk off and equities correct and when the USD strengthens its risk on and the bulls run over in the equity market.
in the case below you can see we have a LOT of confirmations that the USD vs JPY has formidable resistance around 60-70 pips higher.
elliott wave, projections, measured moves, and a host of math come into play from 110.50-111. IF this proves as resistance AND the elliott wave count is correct (a BIG IF) then the equities should correct to finish this final ‘c’ leg of a multi year correction from highs on the USD vs JPY. stay tuned and watch this level closely …
in the fx world, 80 pips can get taken out in minutes or grinding in hours … either way, it’s not that far away.
salute – Bart