Here we have USD/JPY on the 4H chart.
Price recently had an impulse up move, and then an downward correction. The downward correction stalled when price hit the Fibonacci key retracement . With this in play, and knowing that we had a previous impulse leg beforehand, it is clear we are in a 3 wave up move, and that this corrective pullback is merely a pullback before the next up move to our target level of 114.40
When analyzing the pairs behavior after the long term downtrend, I discovered that price has only just broken out of a . The resistance channel would indicate down trend was persisting, but since we did not only break the level, we had an impulse leg out of it, it is clear there is strength in this pair, and there is a reason it is rallying.
^ This does not happen by chance. It happens for a reason. Trade what you see not what you think!
Bare in mind that price could have a retest on swing low before the next move up, at around 113.30 to 113.10.
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Price nicely stalled as predicted. I am now expecting the correction to get a little bit deeper and hit the support area at around 113.20.
When price hits 113.20, I will be watching this chart carefully for a long opportunity to catch the up impulse.
The target for this trade will be a measure move of the previous impulse at 114.50.
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