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Chart of the Day: Usd/Jpy

2 Hour Chart Flows: Long. Price Points: 90.25. Looking for: Top of an ending diagonal

Elliott Wave: The yen has reached near-term highs over the past few trading sessions, shown in our red wave V. The wave count now signals for a near-term turning point, since we came out with an ending diagonal pattern (reversal) in the wave V position.

An ending diagonal is a reversal pattern and as such, traders will look for a move lower, near to the 89.00 support region over the coming days, if the 90.25 sub-wave IV) low of an ending diagonal is taken out in the near-term.

If the wave count is correct, then the Japanese yen should strengthen over the coming days as we can count five completed, red waves up from the 84.80 lows. After every five wave move, a correction is expected.

We are also seeing a divergence between price action and RSI movements, which also indicates that a top may be near.

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Disclosure: no positions