Elliott Wave Analysis of the USD/JPY Currency Pair by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.
The wildly bullish talk regarding the USD/JPY currency pair appears to be well-founded from a supercycle point of view, but the moon-shot over the last 100 days has likely just about run out of rocket fuel.
The October 31 2011 all-time-low ended a 5-wave downward impulse that started all the way back in 1975, and finished with a terminal thrust from a 12-year-long wave-4 triangle (’95-’07). However, the initial up-move through March 15 2012 was very importantly a three-wave affair totalling 861.5 pips, and is therefore likely to be wave 1 (black) of a bullish leading diagonal. Wave 2 black to the downside was also a zigzag, traveling 704.9 pips ending September 13 2012. Now, wave 3 black has reached beyond the length that wave 1 black was, so the leading diagonal must be of the “expanding” variety, and not the more typical “contracting” type.
Since the diagonal is expanding, the imminent downside wave 4 must be longer than wave 2 was. If wave 3 black is complete, and all the proper subdivisions of a blue ABC appear to be in place, wave 4 must move more than 704.9 pips to the downside, to below 79.257 (if wave 3 black is complete) before wave 5 black ensues to the upside, eventually taking out the black 3 high.
The only way to count the move up from the September low as a wave 3 of an eventual non-overlapping upward impulse would be to call the movement up from October 31 2011 through March 14 2012 a standard 5-wave non-overlapping impulse, which is quite a stretch in my opinion. Admittedly, wave 1’s are often “unclean”, so if the up-move from Sept 13 2012 moves past 1.382 times the length wave 1 was, that will become the main count. This would require that the current rise continue relatively unabated to above 89.07 (1194 pips from the Sept 13 low).