AUDJPY Decline Extending Near Term

AUDCAD

AUDJPY

AUDNZD

Commentary – For months, we have been focusing on the long term 5 wave rally from .8165-.9514 which was followed by a 3 wave decline to .8375.  However, since the decline into .8375, price action has been very choppy and the pattern is unclear.  It appears that there are two 3 wave movements (one up and one down).  This is suggestive of a triangle.  Under this scenario, the AUDCAD would remain in a range.

Strategy – Flat

Commentary – The decline from 101.09 is likely wave 5 within the 5 wave bear cycle from 107.84.  The 5th wave is likely to extend much lower given the presence of a series of 1st and 2nd waves (within wave 5 itself).  A near term bearish objective is at 93.13 (161.8% extension of 101.09-96.92/99.89).  The best opportunity in this pair will come on the larger wave 2 (or B) setback that could bring price back to the 101.00 area.  This would offer the opportunity to get bearish for wave 3 (or C ) lower.  This is likely to take a few weeks to set up though. 

Strategy – Flat

Commentary – We have favored the idea that an expanded flat is unfolding and maintain that price will eventually come under 1.1592 prior to the next bullish leg.  The former 4th wave in the 1.1400/1500 area is a potential ending point for the decline (and therefore the entire correction as well).  

Strategy – Look for longs in the 1.1400/1500 area