Ramki has been invited to speak at this important event in Mumbai, India, on 1st May, 2015

Apr 122011
 

Does Elliott Wave Principle work when Central Banks intervene? Remember that wave analysis is one of our tools for trading. We are not attempting to use this as a forecasting tool as much as we use it to decide ‘when’ to buy or sell (for a low-risk trade) and to determine how far a move can travel.

Central banks intervene when forex markets behave in a disorderly fashion. While everyone realizes that a strong Yen will only make it more difficult for Japan to rebuild itself, we have to remember that the Yen is a freely traded currency, and one test of the bottom is usually not enough. So I am inclined to label the current recovery as a 4th wave within an irregular correction. This would mean that USD/YEN will likely make one more attempt to the downside. It is perfectly possible that the BOJ (and its allies) will show up when we break below 78, setting up a potentially ‘failed’ fifth wave. In the meanwile, for the finance manager who has to make payments in Yen in the near term any recovery to 86.90 region will be a chance to buy some relatively cheap Yen, and maybe get some more sleep at night.

  5 Responses to “Elliott Wave Analysis of USD/YEN”

  1. Very nice chart Ramki . This would very much support my view of a 5th wave down yet to be completed in Nikkei which should make a generational buying opportunity problem as always is predicting the bottom. As we saw before, intervention can be swift but indeed that v shaped bottom in usd/jpy and nikkei has the look of a fast and furious bear market rally yen lends itself to those sharp spikes down

  2. Sir,

    I never thought of this perspective. Was seeing the current rally as wave ‘a’ of a three wave up move. One more lesson!!

    Rgds
    Muthu

  3. […] by different analysts. The trouble with all this is the accusations are true! Why, my own Elliott Wave count of USD/YEN published in this blog on 12th April is being changed in today’s update. But anyone who has been following my work carefully would […]

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