Yellow rectangle- support area
Green lines- expected path
Violet lines- Fibonacci retracement levels
USDJPY as expected has pulled back and closed the open gap from Monday's open. Price so far follows our expected price path towards 129.90-130.60 area where we expect to finish the counter trend move. Price is now testing the 50% Fibonacci retracement once again. This time expect to see a move below the 50% retracement towards the 61.8% level which is key support. We usually see trend reversals if price respects the 61.8% retracement. Because price formed 5 waves up from the 128 lows, I expect to see a retracement of this upward move with the formation of a higher low inside the yellow rectangle area.
