USD/JPY: the Yen follows the weakened dollar 11 February 2021, 10:15

 

USD/JPY: the Yen follows the weakened dollar

11 February 2021, 10:15

Scenario
Timeframe	Intraday
Recommendation	SELL STOP
Entry Point	104.30
Take Profit	103.30
Stop Loss	104.70
Key Levels	103.30, 104.30, 104.90, 105.75

Alternative scenario
Recommendation	BUY STOP
Entry Point	104.90
Take Profit	105.75
Stop Loss	104.50
Key Levels	103.30, 104.30, 104.90, 105.75

Current trend

The USD/JPY is declining, trading at the level of 104.60.

The Japanese government continues to support business, and on Tuesday, it decided to provide additional assistance to organizations affected by the state of emergency in the central region due to coronavirus pandemic. In total, it is planned to allocate 1.14 trillion yen, 880 billion of which will be directed to daily payments, and 250 billion – to compensate suppliers of catering organizations. The remaining amount will be used to test the population for COVID-19.

Meanwhile, USD Index trades near the level of 90. During a video conference at the Economic Club of New York, the US Federal Reserve’s head Jerome Powell said that the country's authorities should not pay attention to the growth of national debt, and first of all, it is necessary to focus on stimulating the economy. However, investors considered it as an indirect signal to the start of the next emission, which increased the pressure on USD.

Support and resistance

Globally, the price, having left the borders of the global downwards channel, returned to the resistance line and prepares to enter the channel. Technical indicators begin to change their readings from buying to selling. Fast EMAs of the Alligator indicator are ready to cross with the signal one, and the histogram of the AO oscillator forms downwards bars.

Resistance levels: 104.90, 105.75.

Support levels: 104.30, 103.30.

Trading tips

After decline or consolidation below the local support of 104.30, sell positions with the target at 103.30 are relevant. Stop loss is 104.70, above the current price. Implementation period: 4 days.

After reversal and corrective growth or consolidation above the resistance level of 104.90, buy positions with the target at 105.75 are relevant. Stop loss is 104.50.