Japanese Yen Futures completed some long term bearish patterns in November and then in the first week of December had the largest one week drop in a over decade. First let’s look at the monthly chart. The monthly chart of Yen shows the market completed a butterfly reversal pattern on the last leg up on the rally.

After dropping to the weekly time frame we see the Yen formed an ABCD sell pattern that completed at the 1.27 extension of the AB swing. We can clearly see the weekly bearish engulfing candle that formed in the first week of December.

Based on these two bearish patterns on the higher time frames, traders should be looking for opportunities to enter the market short by dropping to lower time frames and looking for sell patterns to develop. The 4000 tick chart shows an ABCD sell pattern that completes and the low of the Candle that reached both the monthly butterfly and the weekly ABCD sell patterns. If the bears are in charge of this market as the analysis suggests, that area should be defended well on any rallies.  

This entry was posted on Saturday, December 12th, 2009 at 6:08 pm and is filed under General. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.