Did the 2015 high mark the completion of a Wave III or Wave V for USDJPY? Tony Sycamore, Director Institutional Foreign Exchange at Commonwealth Bank of Australia, says we may soon be able to tell, thereby allowing us to forecast the depth of the current pullback.
Sycamore thinks that if the 2015 high at 125.86 was a Wave V high, a deeper pullback remains likely below 110.00. However, if it was a Wave III high, the current pullback is possibly complete and a move above 116.75 would confirm this scenario.
As such, Sycamore says 116.75 is the bull/bear divide, with a close above this level creating significant bullish momentum.