USD/JPY: Technical Support Ahead Of NFP
MarketPulse | Sep 04, 2015 07:55AM ET
The dollar continues to look bearish against the yen today after breaking below Wednesday’s low early in the session to enter into a technical downtrend on the daily chart (lower highs and lower lows).
The pair already appeared to have entered into a bearish period after rebounding off the 61.8 fib level last week, which coincided with the ascending trend line from 16 January lows and a previous region of support and resistance.
Today’s candle is looking particularly bearish and if we see if close near the daily lows, it would suggest further downside is to come. Although it should be noted that marabuzo candles can often be followed by a correction, a rally in this case. The test of this would be around the half way mark of the daily range, a failure at which would indicate a retracement.
The next significant area of support in the pair could be between 118.30 and 118.50 which has been a key zone of support in the past. In particular, you can see this was the case between 9 February and the start of May.
It also coincides roughly with the 55-week simple moving average, which has been an important support for the pair throughout the uptrend over the last few years.
Key resistance to the upside comes around 120.70 as a move above this breaks the technical downtrend. This would bring 121.75 into play – last week’s high – a break of which would suggest the uptrend has resumed.
Original post
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.