Geo demands a set of internal geometric rules that have been met so far:
1 - The 1-2 Line forms a simple reciprocal ab = cd symmetry, or a simple (ZZ): Here, the 04-1995 to 08-1998 span offers a) An internal ab = cd correction and b) a near-perfect symmetry of this geometric reciprocity.
2 - The 2-3 Line is the most complex of all internals, typically a complex ZZ: Here, the 08-1998 to 10-2011 illustrates a more perfect ab = cd geometry, compared to that formed by the 1-2 Line.
3 - The 3-4 Line is most often the simplest of all internal geometries, as ilustrated in this case.
4 - Pending here is the 4-5 Line, which is most often as simple a geometric development as that of the 3-4 Line. Therefore expect a large ZZ as the most common geometric event.
Looking at the overall geometric growth, the internals are a probable series of four internal legs, expressed rhythmically as 3-3-3-3.
Relative to the Geo , price remains bound to three distinct borders - One dynamic and two static:
1 - DYNAMIC BORDER: The 2-4 Line:
The 2-4 Line defines the upper border of the Geo . From a trading standpoint and using Fibonacci ranges, consider the possibility of price rallying up to 0.786-Fibonacci relative to the 116.082/125.856 range, as this would bring price to the vicinity of the 2-4 Line.
2 - STATIC BORDER:
As just discussed, the 116.082/125.856 range are significant low/high points, respectively, which have tethered price action over the past 8 monthly bars.
Whereas a Break Across/Close Across ("BACA") the 116.082 Line would open the floor to bears, similarly, a BACA > 125.856 would likely remain capped by the "tunneling" effect of the 1-4 Line.
The model suggest an imminent completion of the rally that occurred over the 11-2010 to 06-2015 range, which defined the 3-4 Line. Using the structural analysis above, the most prudent stance would be to wait for a confirmation of the BACA < 116.082 level to give further credence to a reversal confirmation.
While the line defined as "WL = 70.946 - 17 JAN 2016" represents an ultimate low, intermediate targets (both quantitative and qualitative) will be published once price marches more definitively outside of that 116.082/125.856 range. Again, this is the most prudent stance to adopt at this point, as the market comes to the complete realization of a probable downturn.
outlook. Consider the combination of market geometries, structural analysis and the bias of the Predictive/Forecasting Model as probable cause for an imminent reversal. A conversion of the 116.082 line from support to resistance would offer the most conservative strategy, as one continues to ponder the strength and resiliency of the 116.082 floor.
I will now use this thread to post all future $JPY and JPY-related crosses.
Predictive Analysis & Forecasting
Durango, Colorado - USA
Linked-In: David Alcindor
From a fundamental stand-point, the $USDJPY is often compared to the S&P-500. In light of recent bearish market accents, one should consider keeping both under the elbow - Feel free to look at prior analyses offered in these charts.
One market analyst commentaries I follow closely are those of Mr. Ashraf Laidi - His recent chart point to a resurgence in net Long $JPY investors, and this might be the impetus bearing down on the $USDJPY. Mr. Ashraf Laidi's comments flow freely on Tweeter under the @alaidi handle. For a more elaborate education on Forex, market flow analysis and a general appreciation of intermarket analysis, consider his book, I highly recommend it - Here is the Amazon link:
"Currency Trading and Intermarket Analysis: How to Profit from the Shifting Currents in Global Markets" by Ashraf Laidi:
Enjoy this great read.
As indicated by the dashed forecast line, price will continue to consolidate at the 110.660. Any retracement is expected to remain limited, with forecast still eyeing decline - A 0.618 retracement from historical high to recent low is probable, whereas new all-time highs remain improbable
OVERALL: No change in outlook, as the overall forecast remains bearish, as shown in original chart.
Price remains tethered to bearish forecast ... Interim reactive rallies are to be expected, but structurally, sequences of lower lows and lower highs should fashion the overall price action:
David Alcindor, CMT Affiliate #227974
- Alias: 4xForecaster
Aside from my prop geometries and prop predictive/forecasting model I use, there is little less I trust or use, except for Elliott Waves.