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The current USDJPY structure points at a wave e cycle-degree triangle pattern that hints at a standard zigzag consisting of primary waves Ⓐ-Ⓑ-Ⓒ.
The bearish move from the last swing high has taken a 5-wave structure, hence, we see it as an impulse wave Ⓐ.
A decline in the minor wave 5 near the 105.88 area can be then expected as part of the impulsive downside leg.
At that level, minor 5 will be at the 78.6% extension of impulse wave 3.
Since a 5th wave has been formed already, we can look at the current impulsive structure as completed too. That means that primary bearish impulse Ⓐ has been completed and wave 3 is not extended as implied in the first scenario.
At the time of writing, the slight upside can be seen as a bullish corrective in wave Ⓑ.
While it is difficult to say what form of a corrective pattern wave Ⓑ will take, we can expect 109.86 to make a good stop. The target is a confluence level of the 50% Fibonacci retracement and wave 3 low.
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