USD/JPY Elliott Wave update: Wave (iii) of three kicks off bearish leg
USDJPY has shifted gears from a corrective phase into a fresh impulsive decline. After completing a textbook zigzag in Wave (IV), the pair has resumed its broader downtrend, and the Elliott Wave structure now shows a clear bearish setup. With price action unfolding into a strong third wave decline, the path of least resistance appears lower—provided resistance at 144.300 holds firm.
Wave (IV) complete – zigzag correction ends
USDJPY completed a clear Wave (IV) in the form of a zigzag, topping near the 146.50 zone. The three-wave A-B-C structure unfolded cleanly within a rising channel before price reversed sharply, confirming the end of the correction.
Wave three unfolding – In the heart of Wave (iii)
Following the completion of Wave (IV), price action transitioned into a bearish impulse, now labeled as Wave (v) of the larger degree. Within this move, the pair is currently progressing through Wave 3, and more specifically, Wave (iii) of 3—typically the most powerful segment of the sequence.
The breakdown beneath prior lows, along with rejection at the origin of Wave (ii) around 144.300, supports the bearish case.
Key levels and bias
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Wave count: In Wave (iii) of 3 of (v).
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Structure: Impulsive decline post-zigzag.
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Invalidation level: 144.300 (origin of Wave (ii)).
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Bearish continuation expected while price remains below resistance.
Author
Zorrays Junaid
Alchemy Markets
Zorrays Junaid has extensive combined experience in the financial markets as a portfolio manager and trading coach. More recently, he is an Analyst with Alchemy Markets, and has contributed to DailyFX and Elliott Wave Forecast in the past.
