Weekend Thoughts on USD JPY

I've kept hearing more and more analysts in CNBC and reading news that JPY will keep on strengthening, and that JPY will be the new favored currency of choice, and so on. My question is what time frame do they have in mind with this target?

Per my USD JPY chart last time, it's true that ITD 7 low is not yet confirmed IN. I usually wait for a daily candle close above the high of the signal day candle (the candle that makes the new low) to confirm that ITD low is IN. In other words, yesterday was the signal day as the daily candle made a new low at 84.8. The high of that signal day candle is at 87, so a daily candle close above 87 in the coming days would confirm ITD 7 low is IN provided that there's no further new low is made. Per my ITD and MTD chart, we are currently close to both ITD low and MTD low.
Traditional analysis like SSI, RSI, Bollinger Band also show that this pair is currently at the extreme end and due for a rebound. We also see a doji candle on Friday, which warns us of a possible change of direction.

I agree that 80 or below is maybe be possible in the long term. But it's not the time to short right now at this price level. Note that once ITD 7 low is IN, MTD 6 low will also be IN together, and Medium Term trend is going to travel UP until the end of December based on my Delta count. The risk reward therefore IMHO favors for a long position, at least in the medium term.

Nov 27 - Weekend update on GBP USD

Posted is my thoughts on cable in intermediate, medium, and long term.

In the Intermediate Term, ITD timing is recently still pretty stretched out and therefore it's a little difficult to precisely time the Intermediate Term. If my ITD position in my last chart is correct, then ITD 6 low should have been due around Nov 27. Since MTD is pointing down, it's possible for a late coming of ITD 6 low, and thus I expect one more low below 1.646 before ITD 6 low is IN. Again, ITD position is strecthed out and not very clear, therefore confidence is not especially high in the Intermediate Term.

Medium Term outlook is more clear and has higher probability. As can be seen in the MTD chart, the last two MTD cycles show that MTD is travelling down until end of December. Therefore, it's likely that medium term trend is travelling down until the end of December. I expect MTD 8 low to be due around end of December.

Long Term outlook is also not very clear because we are in a possible LTD inversion time zone. If you are someone who are bullish in the long term, then the line in the sand is 1.57 (LTD 18 low) and this means that SLTD 4 low is due there. If this is the scenario, then expect range trading between 1.57 - 1.7 for 2 or more months before 1.7 is broken. If you are someone who are bearish in the long term, then it's possible that LTD (18) is due at MTD 7 high, and that we are travelling down in the long term and ultimately breaks 1.57 without breaking 1.7 high. This will probably correlate to the equity market as well. If you believe that equity has topped out, then you should probably use the LTD (18) at MTD 7 high count, and if you believe that equity will keep rallying for another 10-15%, then you should probably use the SLTD 4 low at LTD 18 low count.

The bottom line is that IMHO the clearest outlook is in medium term, where cable should be in medium term downtrend until end of December.

Nov 26 - USD JPY MTD Chart

Posted is the current MTD chart that I have. ITD 7 low / MTD 6 low should be in soon, and MTD 7 high should be due around end of December.

SLTD is pointing down as 87 is broken.

Nov 26 - USD JPY

USD JPY has broken 87, indicating that SLTD is indeed pointing down per my chart yesterday.

Possible support level is at 86.5 and 85.6 as indicated by the trend channel.

Nov 20 - MTD 7 high likely IN

Based on the latest price action, I place ITD 5 high and MTD 7 high as having arrived, and we could be heading to 1.61 in the medium term.

If the ITD positioning is correct, then ITD 6 low should be due around Nov 27.

Nov 17 - GBP USD Update

It has been a difficult few weeks for me to do a Delta count on Cable. Sometimes that's how life is, and I try not to force a count which I am not really sure of. The best way for me is to observe the market until I feel that I am in sync with the market again.

I don't really want to chase this risk appetite rally. I have been flat in FX for a while, and yesterday I have just sold another good chunk of my stock that I entered in January of this year. Sure equity and high beta currency could keep rallying from here just like many analysts said, but I'll just stand aside and not participate in it.

With that said, attached is my attempt to do a Delta count for cable. If this count is correct, then I expect sterling to keep grinding higher in the next few weeks up to ITD 6, perhaps not in straight line, but a gradual grind. I would attempt to build some short position around Nov 27

Nov 4 - USD YEN update

Here's the count for USD YEN that I have.

For cable, I am still waiting for BOE's meeting on Nov 5th. Rather than trying to make up counts that I am not sure, it's better to wait until it becomes clear, which hopefully will be after Nov 5. When in doubt, DON'T TRADE.