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Technical Analysis – USD/JPY

USD/JPY 19 Apr 2018 | EconAlerts

USD/JPY stands in bullish correction mode; the broader trend is bearish.

USD/JPY has advanced considerably after the significant rebound on the 16-month low of 104.60 at the end of the preceding month. Since yesterday’s session the price has been moving slightly higher above the 20- and 40-simple moving averages (SMA’s) in the daily timeframe. Looking at the bigger picture, the US dollar has been developing within a downward sloping channel against the Japanese yen since November 2016.

The positive bias in the near term is supported by the deterioration in the momentum indicators. The %K line of the stochastic oscillator is rising and is attempting a bullish crossover with the %D line. Moreover, the RSI indicator is sloping slightly up above the 50-neutral level, suggesting an upside correction could be possible.

If the market manages to pick up speed and remains above the simple moving averages the 23.6% Fibonacci retracement level near 107.80 of the down-leg from 118.60 to 104.60 could offer nearby resistance ahead of the 108.20 critical level. A successful close above the latter would open the way towards the 38.2% Fibonacci mark around the 110.00 psychological key level, raising chances for further increases.

However, should price decline again, immediate support could be found around the bullish cross of the 20- and 40-day SMA’s near 106.50. Then a leg below that level, the pair could meet the 105.65 level before the focus shifts to the 16-month low.

USD/JPY 19 Apr 2018 | EconAlerts

 

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Disclaimer:
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.


source: XM

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