Japanese Prime Minister Shinzo Abe needs more than three arrows to make progress with the dollar-yen.
This currency pair is doing a five step polka. Unfortunately, all the steps lead to a potential downside target of 100, which is great for short-side traders but not so encouraging for Abe.
The steps in the dance are created by well-defined trading bands. Every time the lower edge of the trading band is broken, the market moves quickly to the next, lower step. The dance is currently between 105 and 109 but a fall below 105 puts the next support level near 100.
Long-term analysis of the dollar-yen chart shows that the dollar-yen moves within well-defined trading bands. The lower edge of the upper trading band is near 117. A fall below this step 1 level in February set an immediate downside target near 113, which was rapidly reached in a single downwards move. Weak consolidation at this level was step 2 of the dance.
The base of step 3 had a downside target near 109 but historically this is a weak level so during the dollar-yen's rise this level offered little resistance. It's a minor point historically, so there was a high probability it wouldn't offer good support in the current fall, which proved to be the case.