03/08/2020 Asian Open Update

the USD vs YEN cross rate is a BIG FX pair to monitor for equity strength and weakness. we had a nice ‘nominal’ 1100 point gap down to the open the DOW futures in Asia and a 20 percent drop in crude. rocking and rolling folks …

as the night progresses, just watch 102.06-103.20 on the USD vs JPY and, a little lower 100.62. We’ve already sliced thru 2 years of support – easily – but do look for these levels to offer a modicum of support over the coming hours/day (s?)

watch the USD vs JPY YEN chart below and these key levels for support of the US equities

USD vs Japanese Yen coming close to resolution (?)

10/22/2017 – we discussed the ‘RSI SHIFT’ below.  taking note of it again …have been on the sidelines w/ regards to the USD vs YEN as I’m waiting for resolution of the downtrend line shown …

note: still in the ‘maybe’ camp of 2 being done … so were going to be watching the YEN very closely in the coming days/weeks.  In the past, YEN strength hasn’t been too good for US Stocks …

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here’s some work that I’ve been doing on the YEN: https://bartscharts.com//?s=yen

just taking a look at the weekly RSI and, when I trained under Constance Brown she said “the market will tell you when it’s shifting, watch the RSI zones for clues.”

as you can see below … the, what I believe, multi-decade wave 5 occurred in 10/2011 and a VERY powerful advance occurred.  You’ve read about my chaos w/in the YEN and how I got stopped out something like 6-8 times (I’ve tried to flush it from my memory) in around 76 ..(yes, 76! and, no one said this was going to be easy!) for what I was expecting was going to be a monstrous ride.

anyway, note how support SHIFTED up after the decades long bear trend … (see dashed green lines) and how, after this correction – which might be pretty much complete it the support and resistance has now shifted down (see dashed red lines) ….

I’m in no mans land right  now .. while I believe another advance of the USD against the YEN may be forthcoming I would have really liked to see the RSI resistance SHIFT back up into the 80’s.  So .. while our ‘count’ isn’t complete in this wave, I’m going to step aside and see what happens the rest of the month.

as you can see w/ the ???? it’s time to sit on my hands and see what plays out … that’s only me. you do what you want and follow our plan, as always.

Bart

page_17-02-12_13-43-04

 

USD vs Japanese Yen

here’s some work that I’ve been doing on the YEN: https://bartscharts.com//?s=yen

just taking a look at the weekly RSI and, when I trained under Constance Brown she said “the market will tell you when it’s shifting, watch the RSI zones for clues.”

as you can see below … the, what I believe, multi-decade wave 5 occurred in 10/2011 and a VERY powerful advance occurred.  You’ve read about my chaos w/in the YEN and how I got stopped out something like 6-8 times (I’ve tried to flush it from my memory) in around 76 ..(yes, 76! and, no one said this was going to be easy!) for what I was expecting was going to be a monstrous ride.

anyway, note how support SHIFTED up after the decades long bear trend … (see dashed green lines) and how, after this correction – which might be pretty much complete it the support and resistance has now shifted down (see dashed red lines) ….

I’m in no mans land right  now .. while I believe another advance of the USD against the YEN may be forthcoming I would have really liked to see the RSI resistance SHIFT back up into the 80’s.  So .. while our ‘count’ isn’t complete in this wave, I’m going to step aside and see what happens the rest of the month.

as you can see w/ the ???? it’s time to sit on my hands and see what plays out … that’s only me. you do what you want and follow our plan, as always.

Bart

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Truncation … low in USD vs JPY in place?

the more I look at:

  • USD Index “low” in place and advancing …
  • thrust/momentum from the lows in the USD vs JPY …

the more a case can be made for truncation as shown below … so, here’s the other side of the coin.  going to have to go for it w/ a stop and see what happens … just waiting for a buy pattern to test the thesis.

Bart

Page_16-09-05_16-30-50

is the Sun going to set or rise in Japan (aka the Land of the Rising Sun)

CLIFF NOTES: for the reasons shown below, 102.70 is the KEY level for the USD vs JPY. If we exceed this level, then believe the USD will begin to soar again vs the YEN.

 

Going to try and work thru the entire “Elliott is good // Elliott is bad argument” by simply saying when it’s an easy count use it and when it’s not .. it’s probably correcting and if you can’t “see” it immediately then bail to another technical tool box.   In the case of the USD vs JPY the weekly and daily count CLEARLY shows 5 waves up from the all time high of the JPY vs $$$.

We made the high around  the first of the year and the pair has been consolidating/correcting ever since … the BULLISH aspect of this correction is it has held the .382 from the wave 4 triangle low … that’s bullish for the USD vs JPY.

What’s interesting to note is we have had two sell patterns that have “worked” but have not been able to drop below the 101 handle ….take a peak:

Main20140817155256

 

now … here’s where Elliott can help you.  In the chart below we have dropped down to a 2 hour chart and we have two potentialities occurring … either we have a 3 that subdivided and 4 just completed which calls for this pair to fall (JPY strength) OR we have a a-b-c correction complete and the USD might begin to skyrocket against the JPY (which OBTW will cause the Nikkei 225 to skyrocket also …the GOOD THING – we know exactly where we are w/ regards to 102.70.  Check it out:

 

this is showing 4 complete and we should be going DOWN
this is showing 4 complete and we should be going DOWN

this is the STRONG dollar case and we completed an a-b-c correction and it's going to take off
this is the STRONG dollar case and we completed an a-b-c correction and it’s going to take off

now, below is the NK 225 futures (continuous) overlaid on top of the USD vs JPY. NOTE THEY ARE ALMOST MIRROR IMAGES OF EACH OTHER …

NK 225 overlaid on USD vs JPY (notice how synchronized they are)
NK 225 overlaid on USD vs JPY (notice how synchronized they are)

 

last thing .. notice the TIME component of this correction.  Since the all time low of the USD vs JPY (10/2011) the corrective timing has been about right for this most recent correction. TIME is a big deal so, perhaps, we won’t see any lower in the USD vs JPY and it’s time to rumble?  My eye tells me the pattern in PRICE isn’t quite done going lower but we have to trade what we see and not believe.  Standing by w/ levels above noted …

the TIME component of this correction is complete
the TIME component of this correction is complete

 

USD vs JPY redux

folks, I’ll say it once, I’ll say it again … PATTERNS PATTERNS PATTERNS.  Check out this post on the JPY and then compare everything that has happened … they help you manage risk and therefore they work:

relative strength of GOLD vs the USDJPY importance

so, where are we now?  let’s take a peak.  first chart is actually showing another pattern complete and the BUY USD vs JPY that we posted on June 27, 2014.  Highlighted areas are the ones to watch.

 

Main20140730215428

now, take a peak and we have completed (or a little higher)  another pattern on the IMPORTANT USD vs JPY YEN cross.  also, note the the N225 futures are up at the .786.

Main20140730215841

now time to go to the relative strength chart (GOLD / USD vs JPY).

Main20140730220530

 

GOLD/USD vs JPY with USD vs JPY overlaid (red line) NOTE HOW THEY ARE EQUAL AND OPPOSITE!
GOLD/USD vs JPY with USD vs JPY overlaid (red line) NOTE HOW THEY ARE EQUAL AND OPPOSITE!

 

what does a BUY pattern mean w/ this ratio?  take note – the equal and opposite inflection occurs w/ regards to the USD vs JPY cross.  So, our thesis is IF the BUY of the ratio holds THEN the SELL $$$ vs JPY patterns that are completing/have completed will cause the YEN to strengthen for another corrective leg.  Additionally, this will foreshadow weakness in the N225.  

see how that works …?  Patiently wait for PATTERNS to form, work them into intermarket and ratio analysis and then pull the trigger when you feel like jumping into a 5 TRILLION dollar a day market w/ gorilla’s juggling dynamite from your simple and humble home office listening to Pink Floyd ….

Let’s complete the YEN circle of life ….

CHF vs JPY Monthly
CHF vs JPY Monthly

 

EURJPY Monthly
EURJPY Monthly

 

AUDJPY Monthly .. UGH
AUDJPY Monthly .. UGH

 

GBPJPY weekly
GBPJPY weekly

 

CADJPY Weekly
CADJPY Weekly

here’s the ETF for Japan … EWJ

EWJ ETF
EWJ ETF

Yen … ramifications of this pattern are big

CLIFF NOTES: let’s face it .. 2014 had been a complete YAWN w/ regards to the USD vs JPY cross.  It completed a 5 wave move up into the 105.50 and now’s it’s been correcting in a rather less than volatile way.  Things are NOW interesting.  Again, PATTERNS PATTERNS PATTERNS is what this blog is all about and we have a PERFECT (time = price) pattern completing.  Please see below:

USD vs JPY 4 hour BUY pattern
USD vs JPY 4 hour BUY pattern

CLIFF NOTES 2: why is this important …? Well, the pattern is completing right on top of a HUGE support level. So, the pattern works and we bounce, start back up OR it fails and we attack a key support level.  This is going to get interesting.

USD vs JPY YEN Daily
USD vs JPY YEN Daily

CLIFF NOTES 3; take a look at the weekly.  appears the RSI is breaking thru the top side of the bullish RSI support zone (40-50) so IF OUR PATTERN FAILS then we can make the probable bet she’s heading lower and into the lower bullish support zone – which on a weekly – can be farther. Right now, the 94 handles looks promising …folks that is 700 pips which is pretty big move.

stay tuned and let me know if you have any questions … watch the PATTERN on the 4 hour and have a good weekend.

Bart

YEN is about to get really interesting …

CLIFF NOTES: 99.40-99.80 is where we “should” see some support come in … take a review at the charts below.  as you can see we have finished 5 waves up at the 105.40 handle.  (note, see this chart below as the 5th wave was completing we were calling for it) so, since we have finished 5 waves up we are either at a 1 w/ 3,5 up to come and we are tracing out 2…or we just did an A and now we are correcting B for a C wave UP.  Also note, we are a couple days (max) away from the same amount of TIME that the triangle shown below formed and completed.  So … it’s going to get interesting, to say the least.  Personally, I wish this pattern was completing lower as the DEPTH of the correction isn’t as big as I would think but is that a sign of the overarching bullishness? hard to say ..but from a TIME perspective we are finishing up the same amount as the triangle.  Keep an eye on this one ….

Here’s is the TOP (real time):

JPY top at 105.40
JPY top at 105.40

here’s a revisit of the long term picture and then, finally, the DAILY pattern that is forming:

Long Term Monthly Picture
Long Term Monthly Picture

WEEKLY
WEEKLY

 

Daily Pattern Completing a little LOWER
Daily Pattern Completing a little LOWER

relative strength of GOLD vs the USDJPY importance

a line in the sand was drawn at 75 in the USD vs JPY when the BOJ, after the horrible tsunami, said – enough is enough this is where the buck stops! the rest is history and a big KABOOM occurred. everyone and the brother can see the coiling occurring w/in this very important currency pair and, quite frankly, everyone and their brother is EXPECTING it to resolve to the upside.  here is the case for that ..

BULLISH POTENTIAL
BULLISH POTENTIAL

now, here is where it gets interesting … is there any possibility of this moving DOWN?  A couple weeks ago, I didn’t think so and here’s the post:

http://bartscharts.com/2013/10/10/japanese-yen-advance/

if you look at that post, we nailed the low and the pair has moved up from the levels indicated.

now it gets interesting, a lot of BEARISH PATTERNS have been completing on the equities side of the house and IF this is marking an important top/pause in the run from 2009, THEN the Nikkei 225 shouldn’t keep going straight up – one would think.  So, being very focused on the FX markets I decided to look at the JPY vs a lot of the pairs from around the world

November 13 2013 CHFJPY November 13 AUDJPY November 13 2013 EURJPY November 12 2013 GBPJPY November 12 2013 CADJPYCHFJPY: stopping exactly where it got smashed a couple years ago and in 1999. (JPY strength) / this is the most fascinating chart IMHO.

GBPJPY: little higher and then major resistance. (JPY strength)

EURJPY: tough call, but higher and we have major resistance (EUR strength?  Seriously?  perhaps if the EURO smashes down, the JPY will strengthen?)

AUDJPY: major sell signal HIT and AUD is weak against the JPY (JPY strength)

CADJPY: major sell pattern HIT and if it holds we’ll get a move low.  Another target is higher also..( but JPY strength)

These 5 pairs do not show the coil and they are showing some JPY strength afoot?  (Cue Wayne’s World – “something is afoot at the circle K”

What to do … well, let’s go back to our ratio’s.  in this case let’s do a ratio analysis of SPOT GOLD / USD vs JPY. Well, look at that …

Relative Strength of Spot Gold vs USDJPY
Relative Strength of Spot Gold vs USDJPY

another parabolic run that is ending badly … but here’s what REALLY makes me go “hmmmm.”  It’s not a stretch to say we are in a very powerful wave 3 down right now in this relative strength chart … but notice how long the wave 2 took to correct!  A pretty long time before things got interesting.  one of the things we are taught in the CMT is form/proportion and balance.  I would just think that wave 4 would take a little more TIME.  So what do we do – go to a time frame lower:

spot gold vs USDJPY relative strength
spot gold vs USDJPY relative strength

so, if we can get to the lower level at 12.56 on the ratio we’ll get a good a idea of where we are…my thesis is that if 1) this level holds and bounces it will cause the YEN to strengthen and if we lose this level to the downside it will cause the YEN to weaken and the triangle of USDJPY will resolve UP.  Here’s why this is so important:

November 13 2013 overlaythe line is the JPY vs USD.  the JPY is “strong” when the blue line is going up and it’s weak when the blue line is going down.  note the TIMING of the inflection points in the ratio.  

SUMMARY: yes, we are at a critical level in the USDJPY contraction …if we keep any eye on the Ratio of SPOT GOLD / USDJPY we might be able to get a “peak” at the directional movement of the coil …

Last, here’s the BEAR count of the USDJPY:

a bearish interpretation ....perhaps?
a bearish interpretation ….perhaps?

 

the issue here is the 4th wave .. with such a powerful move i would expect more consolidation.  But look at the wave labeled 1 – the 4th in that move was a quick “bump in the road” and the 4th before the top at 104 is kind of a mirror image.  perhaps forcing it, but is something to consider.

the last thing to consider is the CLEAR 5 WAVE MOVEMENT INTO the 104 zone.  1,2,3 triangle 4, 5 … quite frankly, why isn’t this count a possibility?  especially if our ratio finds support and goes up some more to relieve the beating it has taken ..

just saying ….stay tuned.