USDJPY – Down
The price sharply declined, triggering a sell signal. However, there was no follow-through on the downside, and this is causing concern. It is already evident that the dollar is attempting to improve its position and turn the unfavorable situation in its favor.
At the moment, the scenario of a decline in wave (iii) of the initial diagonal triangle remains primary. However, it is worth considering a possible alternative.
If the price starts to rise rapidly, it may be due to the formation of wave (ii). In that case, the initial diagonal triangle would take the form as indicated on the chart, with a long wave 1 and a short wave 5. Despite being a somewhat unusual pattern, it has the potential to become the primary scenario.
In this context, it is recommended to maintain existing sell positions. Opening new positions is advisable upon the confirmation of a new local minimum.
Investment idea: Sell at 140.30, stop loss at 140.70, take profit at 137.00.
You may check other analytical reviews on FreshForex website. Source: freshforex.com.
