Japanese Intervention

Japan's Strategy Minister Kan has just confirmed that the Japanese Government has agreed to measures to stop the Yen's rise. This may mark the end of the falling USD/JPY for now.

Shorting the AUD/USD @ 0.9180

The trend line from yesterdays chart is being re-tested and the 61.8% Fibonacci has been hit. I'm taking a short position from here at 0.9180. The RBA Interest Rate decision is coming tomorrow and I expect more downside follow through after the announcement. Keep stops above recent high at 0.9325.

AUD/USD Hourly Chart

Here is my favoured count for the AUD/USD pair. The sharp drop from 0.9325 looks more impulsive than corrective, which is why I believe that red wave 3 down has begun. An important trend line support has been broken and I expect a retest before further downside. I have drawn in the Fibonacci ratios to show where black wave 1 down may finish, this is in no way conclusive however as wave 1 may extend. I will be looking to get short when the trend line is being retested, most likely at the 61.8% Fibonacci of black wave 1 down.

NZD/USD 4 Hour Bearish Counts

Here are several NZD/USD bearish counts. In the above chart a flat is playing out. If this count is correct price action will not exceed the previous top at 0.7635, but may come close forming a double top.

In my second chart above the corrective phase (wave 2) is already complete. If this chart is correct than price will soon fall off sharply in a wave 3 down. This is my favoured count and coincides with my AUD/USD chart which I will post up shortly.

USD/JPY Daily Chart

Here is a zoomed out daily chart of the USD/JPY currency pair. As you can see the recent bearish price action does not at all look impulsive. This means that there is likely to be a push upwards over the coming weeks, most likely to at least 101.00. Daily studies are currently oversold, however this does not mean there will not be some further initial downside, so place stops accordingly.

Here is a zoomed in shot of the above cross section. As you can see the support line at 87.20 was easily and decisively broken. This reflects a weakness in the USD and is a reason to be cautious if purchasing any long positions in this pair.

USD/JPY 4 Hourly

My original leading diagonal count for the USD/JPY pair is no longer a possibility as price has broken through support at 88.011. Here is a new count of what may now be happening with the pair. There is a strong support line at around 87.12 drawn from the lows of December 2008 and January 2009. I do not expect this support to be broken easily. I will be setting a limit order to buy a small position in this pair at 87.20, with a stop at 86.00, just beneath the 138.2% Fibonacci of the A leg of the flat.

New USD/JPY Count

Here is an updated count for the USD/JPY pair. Recent price action has invalidated my triangle count, but I am still confident of more USD strength against the Yen in the near future.

USD/JPY Hourly Chart Update

Here is an update of the triangle I think the USD/JPY is forming. So far Fibonacci ratios have been perfect with wave C being 61.8% of wave A and wave D being 61.8% of wave B by price. Wave E looks like it will complete over the next few sessions and then I expect a sharp move north.

Other EUR/USD Possible Scenarios

Here are some more possible scenarios for the EUR/USD pair.

The above chart shows a regular flat forming with an unorthodox wave C being only 61.8% of wave A. This is not an uncommon occurrence in FX markets and fits in with the rising trend line support holding.

The above chart shows a possible triangle scenario unfolding. Once again the rising trend line support will play an important role in keeping price action up. Both of these scenarios are possibilities, although I favour the scenario from my previous charts (see below) where wave C slices through the support line and drops to the 1.45 area.

USD/JPY Daily Chart

Just a quick note on UJ, notice how the pair hasn't been able to close beneath the 61.8% Fibonacci Level even after several attempts? I am very bullish on is pair and anticipate a strong upward move at some point over the next week.