U.S. Dollar/Japanese Yen (USDJPY) Day Chart.
USD/JPY Elliott Wave technical analysis
-
Function: Bearish Trend.
-
Mode: Impulsive.
-
Structure: Navy Blue Wave 1.
-
Direction next lower degrees: Navy Blue Wave 1 (Started).
-
Details: Navy Blue Wave 1 has initiated a new downtrend.
-
Wave cancel invalidation level: 158.924.
Analysis overview:
This analysis examines the USDJPY currency pair using Elliott Wave Theory on a daily chart, identifying a bearish trend in an impulsive mode. The primary wave under observation is Navy Blue Wave 1, which has recently started, marking the beginning of a new downward movement.
The development of Navy Blue Wave 1 suggests the market has entered an impulsive phase, driven by strong bearish momentum. This wave is part of a larger structure, indicating the potential for further downside movement as the trend progresses. Traders should monitor this phase closely, as it represents the early stages of a broader bearish cycle.
Key considerations:
-
The invalidation level for this wave count is set at 158.924.
-
A rise above this threshold would invalidate the current wave structure, requiring a reassessment of the market outlook.
-
The impulsive nature of Navy Blue Wave 1 signals a sustained bearish trend, emphasizing strong downward pressure in the market.
Conclusion:
The daily chart analysis for USDJPY indicates the beginning of a bearish trend, triggered by the initiation of Navy Blue Wave 1. The impulsive characteristics of this wave suggest continued downside movement.
The invalidation level at 158.924 acts as a key risk management point, ensuring traders have a clear threshold for confirming or rejecting the wave count.
This Elliott Wave analysis provides valuable insights, helping traders align their strategies with the emerging bearish trend while remaining vigilant for potential market reversals.
U.S. Dollar/Japanese Yen (USDJPY) 4-Hour Chart.
USD/JPY Elliott Wave technical analysis
-
Function: Counter Trend.
-
Mode: Corrective.
-
Structure: Orange Wave 2.
-
Position: Navy Blue Wave 1.
-
Direction next lower degrees: Orange Wave 3.
-
Details: Orange Wave 1 of Navy Blue Wave 1 appears completed, with Orange Wave 2 currently in play.
-
Wave cancel invalidation level: 158.924.
Analysis overview:
This analysis examines the USDJPY currency pair using Elliott Wave Theory on a 4-hour chart, highlighting a counter-trend movement in a corrective mode. The primary structure under observation is Orange Wave 2, which has commenced following the completion of Orange Wave 1 within Navy Blue Wave 1. This development signals a temporary market pullback.
At present, the pair is positioned in Navy Blue Wave 1, with Orange Wave 2 actively in play. This phase represents a corrective movement, allowing the market to consolidate the gains made during Orange Wave 1.
Once Orange Wave 2 concludes, the emergence of Orange Wave 3 is expected, potentially signaling a return to upward momentum.
Key considerations:
-
The invalidation level for this wave count is set at 158.924.
-
A decline below this threshold would invalidate the current wave structure, requiring a reassessment of the market outlook.
-
The anticipated emergence of Orange Wave 3 suggests a potential shift back to bullish momentum after this temporary corrective phase.
Conclusion:
The 4-hour chart analysis for USDJPY highlights a counter-trend corrective phase, driven by the formation of Orange Wave 2 within Navy Blue Wave 1. The completion of Orange Wave 1 signals the beginning of this temporary pullback, with Orange Wave 3 expected to follow.
The invalidation level at 158.924 provides a key risk management reference, helping traders confirm or invalidate the current wave count.
This Elliott Wave analysis delivers structured insights into the ongoing corrective movement, equipping traders with the necessary guidance to navigate the market and prepare for potential future shifts within the Elliott Wave framework.
Technical analyst: Malik Awais.
USD/JPY Elliott Wave technical analysis [Video]
As with any investment opportunity there is a risk of making losses on investments that Trading Lounge expresses opinions on.
Historical results are no guarantee of future returns. Some investments are inherently riskier than others. At worst, you could lose your entire investment. TradingLounge™ uses a range of technical analysis tools, software and basic fundamental analysis as well as economic forecasts aimed at minimizing the potential for loss.
The advice we provide through our TradingLounge™ websites and our TradingLounge™ Membership has been prepared without considering your objectives, financial situation or needs. Reliance on such advice, information or data is at your own risk. The decision to trade and the method of trading is for you alone to decide. This information is of a general nature only, so you should, before acting upon any of the information or advice provided by us, consider the appropriateness of the advice considering your own objectives, financial situation or needs. Therefore, you should consult your financial advisor or accountant to determine whether trading in securities and derivatives products is appropriate for you considering your financial circumstances.
Recommended Content
Editors’ Picks

EUR/USD extends daily rally toward 1.0500 after US PMI data
EUR/USD preserves its bullish momentum and advances toward 1.0500 in the American session on Monday. The disappointing ISM Manufacturing PMI seems to be weighing on the US Dollar and helping the pair push higher.

GBP/USD remains bid and challenges the 2025 high past 1.2700
Further upside impulse lifts GBP/USD back above the 1.2700 barrier, trading at shouting distance from YTD highs on the back of the intense move lower in the US Dollar.

Gold battling to recover the $2,900 mark
Gold continues to pull away from the multi-week low it set near $2,830 on Friday and trades above $2,880 in the second half of the day on Monday. The uncertainty surrounding the Trump administration's trade policy and retreating US yields after weak PMI data support XAU/USD.

Bitcoin corrects after sharp recovery during the weekend
Bitcoin price corrects and trades slightly down near $92,000 at the time of writing on Monday after rallying nearly 10% the previous day. Despite the recovery during the weekend, investor sentiment remains weak as US spot ETFs recorded a $2.39 net outflow last week, signaling institutional demand weakness.

Seven fundamentals for the week: Angst rises ahead of tariff deadline and full buildup to Nonfarm Payrolls Premium
A reality show in the White House – the world is still digesting the dressing down of Ukraine's President Volodymyr Zelenskyy in the White House, but markets have to focus on other actions of US President Donald Trump: tariffs. The dramas come in a week of top-tier data. It is time to fasten your seatbelts.

The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.