USDJPY: 04/18/2017

USDJPY phasing

Charted above is my phasing analysis on the USDJPY weekly chat. I am anticipating a 20 week cycle low at the time of writing which should see the USDJPY move sideways to up. The SCC suggests that the 54 month cycle low is not in yet with one more 20 week cycle left in script. It is important to note, that JPY shorts i.e. long the XXX/JPY pairs are probably my favorite trade in the currency markets going forward. I believe that we are likely to get a parabolic rise in the JPY pairs considering from an amplitude percentage ratio the advance seen recently in the JPY pairs dwarfs that which occurred under a similar cyclical circumstance. It is important to note however that the JPY could stage gains in the upcoming 20 week cycle but the most similar SCC we have on the chart suggests that a higher low is likely to occur, here is the projection of that SCC in the following picture.

USDJPYlarger projection

The correlation is phenomenal and stands at approximately 86%. This gives us reason to believe that we have isolated the right portion of the price history in order to form this projection. Back to my point on amplitude percentage ratio. Take a look at how much larger the advance that occurred in the current cyclical circumstance is relative to that which occurred under a similar cyclical circumstance. This suggests that the move to the upside is likely to be much more severe from an amplitude percentage ratio perspective. Let us further fine tune the projection with the most recent price action.

USDJPYshort term projection

The projection above is fine tuned to sync the most recent minor cycles. Notice that the similar cyclical circumstance suggests that we are likely to get a straddled trough for the current 54 month wave. In fact the SCC suggests that the USDJPY is likely to stage a large accumulation pattern which is likely to break out to the upside once the inflation lid is tipped off in Japan.


The chart above presents my phasing analysis on the USDJPY from a longer term perspective. It seems evident that we have put in a 54 year cycle trough in the year 2011 since the 18 year cycle VTL has been taken out. This tells us that the JPY pairs are approximately one 18 year cycle out of phase with the equity market. This information is certainly important for us to know and understand since it validates our interpretation in terms of the US equity market as well which can be found under “Stock Indices” in the main menu.

In conclusion I would like to state that besides owning Gold, Gold Shares, Russian Energy and Russian government bonds, I see a JPY short as one of the greatest currency trades of this century. An eventual rally to new all time highs in terms of the JPY pairs is certainly not out of the question!

Kind Regards,

Ahmed Farghaly


Potential Butterfly pattern:

USDJPY - Primary Analysis - Apr-18 1428 PM (1 week)

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