Friday, March 26, 2010

AUD/JPY Trade Idea


While my CAD/JPY count was invalidated by a break above the January high, my AUD/JPY is still very much possible. Here is my 4 hour chart. As you can see a final 5th wave is needed to complete the impulse from 81.72. I expect this final wave will complete at around 85.20, which is where wave 1 is equal to wave 5 (shown below), however if it pushes beyond there it will encounter a significant resistance zone where several major highs have formed in the past. This move is beginning to look tired, as you can see in the chart, the A leg of 2 was much sharper than the C leg has been so far. RSI divergence also warns of impending downside.

Here is a close up hourly of the C leg of green wave 2 so far. As you can see the final 5 does not yet look complete. Expect a push above 85 to complete this move. I will be looking to short from 85.10 with a stop above the recent high at 86.20.

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