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S&P Futures turned around perfectly from that 1655/1660 resistance area that we highlighted several times in our past updates. Notice that the pull-back from 1636 was in three waves that now appears complete after the current new leg down.

In fact, we also see a head and shoulders pattern that is pointing for a sizeable move to the downside if/when neckline gives way.

S&P Futures 1h

USD JPY Elliott Wave Analysis May 31 2013 S and P outlook for forex

If the S&P count above is correct, then USD/JPY will continue lower because of the positive correlation. The price could fall sharply in such a case, through the 100 figure within wave three. 101.27 is now short-term critical resistance.

USDJPY 1h

USD JPY S and P Elliott Wave Analysis outlook for May 31 2013 forex trading