USD/JPY > 111... Longs possibly on the horizon.
Weekly Gain/Loss: -0.34%
Weekly Closing price: 110.97
Weekly perspective:
Following a retest to the underside of the 2018 yearly opening level at 112.65 two weeks back, price recently crossed swords with a trend line resistance-turned support (taken from the high 123.57). Having seen this line hold firm as resistance on a number of occasions in the past, it’s likely we’ll witness a round of buying take place from here as support this week.
Daily perspective:
What’s also notable about the current weekly trend line support is it converges with the top edge of daily demand posted at 110.28-110.78. Regrettably, though, nearby daily resistance at 111.16 is proving a troublesome barrier to overcome. Beyond this line, resistance is not expected to enter the fold until 112.11.
H4 perspective:
Intraday movement on Friday saw the USD/JPY plunge below the 111 handle in a matter of minutes, following headline US GDP print a lower-than-expected read. Sellers continued to reign following the break of 111, bringing the candles to an interesting area of support marked in green at 110.65/110.81 (comprised of July’s opening level, a support level and a 61.8% Fib support).
Areas of consideration:
With the 111 handle lurking directly above current price, as well as nearby daily resistance at 111.16, entering long from the green zone mentioned above on the H4 timeframe at 110.65/110.81 is a challenge.
Similar to Friday’s suggestion, waiting for H4 price to close above 111 and retest the top edge of the base as support could be a way forward for longs (blue arrows). To the left (above 111) we see limited supply (see H4 chart – green arrows). This – coupled with the possibility of weekly buyers lifting price action higher off its trend line support and eventually breaking through daily resistance adds weight to longs here we believe.
Should the retest of 111 form in the shape of a H4 full or near-full-bodied candle this would, in our view, be enough to consider longs in this market. As for take-profit targets, the ultimate area of interest falls in at the 2018 yearly opening level seen on the weekly timeframe drawn from 112.65.
Today’s data points: Limited.
Weekly Closing price: 110.97
Weekly perspective:
Following a retest to the underside of the 2018 yearly opening level at 112.65 two weeks back, price recently crossed swords with a trend line resistance-turned support (taken from the high 123.57). Having seen this line hold firm as resistance on a number of occasions in the past, it’s likely we’ll witness a round of buying take place from here as support this week.
Daily perspective:
What’s also notable about the current weekly trend line support is it converges with the top edge of daily demand posted at 110.28-110.78. Regrettably, though, nearby daily resistance at 111.16 is proving a troublesome barrier to overcome. Beyond this line, resistance is not expected to enter the fold until 112.11.
H4 perspective:
Intraday movement on Friday saw the USD/JPY plunge below the 111 handle in a matter of minutes, following headline US GDP print a lower-than-expected read. Sellers continued to reign following the break of 111, bringing the candles to an interesting area of support marked in green at 110.65/110.81 (comprised of July’s opening level, a support level and a 61.8% Fib support).
Areas of consideration:
With the 111 handle lurking directly above current price, as well as nearby daily resistance at 111.16, entering long from the green zone mentioned above on the H4 timeframe at 110.65/110.81 is a challenge.
Similar to Friday’s suggestion, waiting for H4 price to close above 111 and retest the top edge of the base as support could be a way forward for longs (blue arrows). To the left (above 111) we see limited supply (see H4 chart – green arrows). This – coupled with the possibility of weekly buyers lifting price action higher off its trend line support and eventually breaking through daily resistance adds weight to longs here we believe.
Should the retest of 111 form in the shape of a H4 full or near-full-bodied candle this would, in our view, be enough to consider longs in this market. As for take-profit targets, the ultimate area of interest falls in at the 2018 yearly opening level seen on the weekly timeframe drawn from 112.65.
Today’s data points: Limited.
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