USD/JPY: trend reversal 16 February 2021, 10:05

USD/JPY: trend reversal

16 February 2021, 10:05

Scenario
Timeframe	Intraday
Recommendation	BUY STOP
Entry Point	105.81
Take Profit	107.05
Stop Loss	105.00
Key Levels	104.46, 105.28, 105.81, 107.05

Alternative scenario
Recommendation	SELL STOP
Entry Point	105.28
Take Profit	104.46
Stop Loss	105.70
Key Levels	104.46, 105.28, 105.81, 107.05

Current trend

The USD/JPY pair is rising, trading at 105.57.

As the number of new cases of COVID-19 drops, the Japanese Ministry of Health, Labor, and Welfare announced that the first vaccine to be officially approved was a drug from Pfizer. It 400,000 doses have already been delivered to the country. Vaccinations of healthcare workers are expected to begin on February 17. However, the main factor that determined JPY dynamics was yesterday's data on Japanese Q4 GDP. The indicator was 12.7% YoY, down from 22.9%, and 3.0% QoQ, down from 5.3% for the last month.

After the weekend, the USD Index moves uncertainly, trading at 90.270, which is almost the same as the closing level on Friday. Yesterday in the US, the most discussed topic was President Joe Biden's call for tougher gun laws. The main point of the proposal is the removal of immunity for weapons manufacturers. This issue was sharply discussed even during the leadership of Barack Obama but then the initiative could not be approved.

Support and resistance

Globally, the price, having gone beyond the downwards channel, tested the support line and went up. Technical indicators remain in the buy state. The fast EMAs of the Alligator indicator are above the signal one, and the histogram of the AO oscillator trades in the positive zone.

Resistance levels: 105.81, 107.05.

Support levels: 105.28, 104.46.

Trading tips

After corrective growth or consolidation above the resistance level of 105.81, buy positions with the target at the resistance level of 107.05 are relevant. Stop loss is 105.00. Implementation period: 4 days.

After reversal and decline or consolidation below the local support of 105.28, sell positions with the target at 104.46 are relevant. Stop loss is 105.70, above the current price.