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Technical Analysis

USD/JPY Edges Higher

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Price goes higher very fast as the Yen is punished by the Nikkei’s amazing rally. USD/JPY resumed the yesterday’s immense bullish candle and approaches the 110.66 previous high. The pair rallied even if the dollar index has failed to stay above the 92.00 yesterday’s high.

The USDX increased as much as 92.09 today, but now is trading below the 91.92 static resistance (support turned into resistance). USDX rebounded because it was too oversold to drop much deeper on the short term, only an accumulation will signal a potential broader rebound.

The Yen is into a corrective phase on the short term as the JP225 index seems unstoppable on the short term. The index has ignored the 19700 horizontal resistance and is heading towards the 20058 static resistance, where he could find resistance again.

A further increase will send the Yen into agony, right now only the fundamental factors could turn it to the downside again.

Price moves in range on the daily chart and most likely will continue this extended sideways movement in the upcoming period. USD/JPY rallies after the false breakdown below the 108.12 level and after the failure to reach the 61.8% retracement level. Resistance can be found higher at the third warning line (WL3) of the major descending pitchfork, at the 38.2% retracement level and at the warning line (wl1) of the ascending pitchfork.

It’s hard to believe that we’ll have a sharp rally that will reach the confluence area formed between the mentioned resistance levels.

Author: MultiBank Exchange Group Website: http://www.mexgroup.com
MultiBank Exchange Group
Multibank Exchange Group (MEX Group) is a multinational financial derivatives dealer. Established in California in 2005, MEX has offices in several countries around the world, including the US, the UK, Australia and China. Mex Group is regulated by the Australian Securities and Investment Commission (ASIC) in Australia, the Ras al Khaimah Free Trade Zone (RAK) in the United Arab Emirates and the Financial Services Commission (FSC) in the British Virgin Islands.
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