USD/JPY: general review
29 January 2019, 13:47
| Scenario | |
|---|---|
| Timeframe | Weekly |
| Recommendation | SELL |
| Entry Point | 109.42 |
| Take Profit | 108.00 |
| Stop Loss | 110.30 |
| Key Levels | 104.60, 105.55, 107.25, 109.07, 108.00, 109.80, 110.00, 110.35, 110.75, 111.30, 111.70 |
Current trend
The US dollar continues to win back the losses of the beginning of the year, the pair moved to a stage of gently sloping progressive growth.
The instrument is almost back to December levels. Last week, the pair has been correcting laterally, then reached the lower border of the current channel and rebounded from it, receiving additional support from investors. Last week releases on major indices in Japan were weak, while the United States, by contrast, published favorable data. However, the pair failed to strengthen seriously, which indicates the strength of the Japanese currency.
This week, one should focus on data on the US labor market and key indices. Japan will respond with publications on retail sales and the construction sector.
Support and resistance
Looking at the dynamics of the pair for January, we can conclude that now it will only move upwards. But one should definitely take into account the factor of increased demand for the yen as a "safe haven". In the medium term, the instrument will continue to consolidate within a wide range of 108.00–110.75. In this case, the pair may not consolidate within the channel from the current level but will go lower, to a strong support level of 108.00. Otherwise, an upward wave to 110.75 and a subsequent decline to 108.00 may happen.
Technical indicators on H4 chart and above still give a decline signal: MACD indicates the preservation of the high volume of short positions, and Bollinger Bands are pointing down.
Support levels: 109.07, 108.00, 107.25, 105.55, 104.60.
Resistance levels: 109.80, 110.00, 110.35, 110.75, 111.30, 111.70.
Trading tips
In this situation, short positions may be opened from the current level with the target at 108.00 and stop loss at 110.30.
The US dollar continues to win back the losses of the beginning of the year, the pair moved to a stage of gently sloping progressive growth.
The instrument is almost back to December levels. Last week, the pair has been correcting laterally, then reached the lower border of the current channel and rebounded from it, receiving additional support from investors. Last week releases on major indices in Japan were weak, while the United States, by contrast, published favorable data. However, the pair failed to strengthen seriously, which indicates the strength of the Japanese currency.
This week, one should focus on data on the US labor market and key indices. Japan will respond with publications on retail sales and the construction sector.
Support and resistance
Looking at the dynamics of the pair for January, we can conclude that now it will only move upwards. But one should definitely take into account the factor of increased demand for the yen as a "safe haven". In the medium term, the instrument will continue to consolidate within a wide range of 108.00–110.75. In this case, the pair may not consolidate within the channel from the current level but will go lower, to a strong support level of 108.00. Otherwise, an upward wave to 110.75 and a subsequent decline to 108.00 may happen.
Technical indicators on H4 chart and above still give a decline signal: MACD indicates the preservation of the high volume of short positions, and Bollinger Bands are pointing down.
Support levels: 109.07, 108.00, 107.25, 105.55, 104.60.
Resistance levels: 109.80, 110.00, 110.35, 110.75, 111.30, 111.70.
Trading tips
In this situation, short positions may be opened from the current level with the target at 108.00 and stop loss at 110.30.
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