USDJPY is trading just below 110.00 handle after testing 110.10 over the last week. The recent rally between 109.10 and 110.10 looks corrective until now. Potential remains for bears to take control back dragging below 108.00, going forward.
USDJPY larger degree wave structure is as follows: The currency pair seems to be unfolding a corrective (A)-(B)-(C) structure since 101.18 low, which is not seen here. Within the corrective rally, Waves (A) and (B) terminated at 111.75 and 102.59 respectively.
If the above is correct, larger degree Wave (C) is unfolding since 102.59 low, and is expected to push through 112.50 at least to complete the corrective structure. Further within Wave (C), the pair has terminated Waves (1) through (4) around 104.30, 103.40, 111.65 and 108.75 levels respectively.
If the structure holds well, USDJPY is already unfolding Wave (5) against 108.75 and is poised to print above 112.50. Alternatively Wave (4) might be unfolding as a combination, and drag below 108.75 before termination.
USDJPY needs to stay below 110.80 mark for the alternate cunt to unfold. Also a drop below 109.40 will confirm that bears are back in control. Traders might position on the short side thereafter.
The Profinacademy.com Team
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