On the daily chart of USD/JPY we are observing a nice impulsive decline taking place, with price now trading in one of its temporary corrective sub-waves, wave 4-circled. If that is the case, then current sideways price action could suggest that we are dealing with a triangle correction, a continuation pattern that can push price towards the 96.00 area, once the pattern is completed.

USD/JPY, Daily

A Triangle is a common 5 wave pattern labeled A-B-C-D-E that moves counter-trend and is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide into 3-3-3-3-3.

Basic Triangle Pattern: