We had been following the Yen trade even before 2013 for our premium subscribers. However, in January it looked as though the first big downward move was nearing completion. Here is the first Yen chart we posted on our public blog, when we cautioned anyone who was still short to take profits and wait for another opportunity.
By July, we had identified a target for the retrace. (We weren’t encouraging a long trade into the target though, and that’s good, because the retrace level ended up not working out.)
At the end of August, we proposed a swing trade to take advantage of what looked like a developing 4th-wave triangle. Even though triangles can be difficult to forecast precisely in terms of how long they will last, they can be a very friendly pattern for the patient trader.
The triangle lasted longer than we first estimated it would, but in late October we had a pretty good read on where it would end and where to try the short trade. We identified targets for decline. We also defined the level where our scenario would be invalidated, and thus the level where stops should be placed.
The trade started moving favorably in November.
Now at the beginning of 2014, price has reached its first target for the current move. We think it can continue lower before a serious bounce, but it doesn’t have to.
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