J61!
Yen - Long Term TrendThe Yen is sitting near an important trend line going back to late 70's.
Could be near an important turning point. A break in the current downtrend similar to 90' and 98' could be the start of an extended rally in the yen.
FXY is the corresponding ETF to watch.
Crime...what crime? The J6 has returned to the scene of the crime and has kissed it good bye. A breach of the 8388 are and we will goto a lower time frame to look for a trigger. This will support higher equity prices.
Pressure for equities?The J6 has broken out of it's pattern. This is bullish for equities and could place pressure on the indices.
See our weekly outlook: youtu.be
DX US Dollar index $DXYUS Dollar showing signs of distribution as evidenced by accumulation in E6 Euro, J6 Yen and A6 Australian Dollar. #1 Short term excess supply signal has been flashing on/off today signalling a high probability of more selling. Note: no new cyclical support or resistance levels have calculated and printed at this time. This distribution will most likely take a week or two. $CL WTI Crude futures show accumulation also. These are my opinions based on current evidence.
$EURUSD $E6_F Euro currencyAccumulation. Near term swing low is within sight. $DX_F DXY US Dollar is encountering supply from $88 - 92 at the same time. $J6_F $USDJPY Japanese Yen is near support. All the major currencies are displaying a near term change in trend. More confirmation needed. Seeing early signs.
J6 USDJPYJ6 Japanese Yen futures... neutral currently then long/bullish at $0.856. This represents support from 2007 and corresponds to resistance in DX DXY US Dollar Index.
EurJpy Continues to DropPlease see chart notations. This is a continuation of a previously published chart. Pitchforks are drawn on trend changes marked with The Larks LMA indicator. The last LMA trend change marked allowed for the upward pitchfork to be drawn. Current price is still within the green bullish price action box but will continue to sell off and slide to the 137.45 price level due to a large gap which needs to be filled. Once this gap is filled we will have an opportunity to see who takes control of the pair, the bulls or bears. I see the 136.40 handle as the final line in the sand. If the bears take control, the bearish target of 133.20 handle will most certainly be considered a high probability.
What does this mean for equitiesThe J6 is definitely weak and now has broken the April lows. This doesn't fair well for equities. If it stays below the most recent swing high then we could see more upside on the equities. The J6 didn't pull back far enough for us to initiate a short so we will keep looking for entries.
Looking shortWill this level hold? The J6 has been dancing around for while now and I am sure it has eaten many accounts. However, now she has come down to test April lows. From this point we will nibble (small size) on any bounces looking for a break (and hold) below the April lows.
She goes this way...for nowThe J6 has broken down...but is this yet another head fake? We are not in this trade and choose to sit on the side lines. If you look at the weekly chart we are technically not out of the woods. We will watch for any reversals back into the chop...they could present a retest of the upper channel. For now we watch.
Very Bullish case for Euro Yen short and medium termLMA 0.886 swing points used for Fib Time extension, Fib pitchfork and Fib Retracement tools. According to this chart, price has just surpassed the resistance of the 2.618 Fib Time extension ((change in trend emminent)). Downtrend Fib pitchfork uses the LMA swing points and the upward Fib pitchfork uses the last swing points of LMA 0.577.
"Hey Doc, she's still dead"!The 6J is still dead. The "experts" think they can guess the direction. Most got stopped out on the most recent break lower. Head fakes will kill your P&L. Don't let the pundits lull you in to a stupid trade. We are still on the side lines with the $J61!. There is NO edge. Be smart and keep your powder dry while waiting. There are better trades available.
Get the crash cart. The 6J is officially dead in the water. We will avoid this until we see defined breaks. See our last posts for break areas. If you think you "must" trade it...understand it's going to be choppy ride and it will most likely eat your trade account. Be patient and find a better instrument to trade. Keep your powder dry.
What next?The 6J has broken out (minor) to the downside and we are at the go-no go area. Aggressive traders will sell this area. We are being very cautious due to the recent false breaks. We choose to sit this out until we see a better break. What does that look like? If we break 9725 on the down side we will nibble (very small) to the downside. If we break 9920 on the upside we will buy all pullbacks. It's interesting to note that while the S&P is rallying the 6J is doing nothing. If the 6J breaks to the downside we will see much higher in the indices. If we see a nice break to the upside then we could sell off for a while in the indices. With this pull back we are in the middle of the junk and it's a fight for control...try not to get caught in the fight. Right or wrong the big boys have deeper pockets.
