A Real Godzilla In Japan ? USDJPY and Nikkei
“Godzilla’s exact origins vary, but it is generally depicted as an enormous, violent, prehistoric sea monster awakened and empowered by nuclear radiation.” Source : Wikipedia
“TOKYO—Deep beneath Fukushima’s crippled nuclear power station, a massive underground reservoir of contaminated water that began spilling from the plant’s reactors after the 2011 earthquake and tsunami has been creeping slowly toward the Pacific.” Source : Epoch Times
I have been a Godzilla fan as a child when Godzilla was Ultraman’s favourite enemy No.1. At the rate the radiation is going, I reckon we can finally test the Godzilla theory soon.
From the radioactive Ichimoku cloud, USDJPY is directionless but the Nikkei is starting to look a little restless into month end. Will we have 3 consecutive month end dojis ?
The chart is starting to look a little insipid, running into the headwinds of the US taper and the EM crisis.
On the horizon is the sales tax hike to pass in October which is viewed as a favourable event for the USDJPY.
I see 2 wedges. A near term wedge for the week into BoJ (5 Sep), and a longer term wedge after that to coincide with the German elections as we hug tightly to the mid of the Bollinger bands.
Wedges are meant for break outs – Up or Down.
Given my view that EUR is likely to head lower to 1.3186, I am inclined to see the USDJPY higher, at perhaps the 99.20-50 level. Until then, we have the gravestone doji in the Nikkei to keep a check on our enthusiasm.