Another “Head & Shoulders”. EUR/JPY wave analysis.

Analysis for August 21^st, 2014

In our previous review, “Now – up! Wave analysis of EUR/JPY for 12.08.2014”, we discussed a possible scenario how the price may start an ascending zigzag(d) of [iv].



Probably, the pair is about to finish wedge[1] of a of (d) of an ascending zigzag(d) of [iv] of C. Later the price is expected to form a descending correction [2] of a, after which the uptrend may continue inside wave [3] of a. In terms of technical analysis, the price is forming upside down head & shoulders reversal pattern a bit bigger than earlier (in green ellipse).



Mid-term expectations haven’t changed much. The current chart structure implies that the pair is forming a horizontal triangle[iv] of C of (C), which may be followed by the final ascending wave [v] of C. One of the main waves of triangle patterns is usually the longest and most complicated, so possibly the third zigzag(c) of [iv] may turn out just this type of wave

If this assumption is correct, then in the nearest future the price is expected to form the final zigzags(d) and (e) of [iv] of triangle[iv] of C of (C).

However, at the same time one should remember that any possible scenario is subjective and the market may move in a completely different direction.

RoboForex Analytical Department