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USDJPY: Keep an Eye on 111.40

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A few days ago I commented on a potential USDJPY rising wedge.

It was an early stage pattern without much structure, so there was a good chance it would need to be modified.

That’s what we’re seeing so far this week. The pair has broken above the 110.00 area and is fast approaching a key resistance zone between 111.40 and 111.70.

USDJPY has seen a lot of reversals from this area since early 2016.

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However, there are no guarantees sellers will be able to defend 111.40/70 if tested over the coming sessions.

A study of the price action since mid-2017 shows a range bound market.

So despite the aggressive 700 pip breakdown that occurred in December, there is little to no longer-term momentum here.

That range extends as high as 114.50 and as low as the year-to-date low at 105.60.

That’s a lot of chart to analyze, but it’s important to keep the range in mind in case you’re thinking of selling USDJPY sometime soon.

For now, a retest of the 111.40/70 resistance area followed by bearish price action such as a pin bar could push the pair back to 110.00 support.

Alternatively, a daily close above 111.70 would extend the current rally.

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USDJPY key horizontal levels

Leave a Comment:

9 comments
WildBill says

If the dollar is entering a 5th wave to the upside, then the rally on the UJ will be consistent

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Priscilla says

Thanks a lot for update

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Henryk says

Witaj Justin,jakie średnie kroczące wykorzystujesz na wykresie SMA czy EMA ?.

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Richard ameko says

Pls no chart from you for this analysis?

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    Richard ameko says

    Sorry its from my internet connection.

    Reply
Diteboho says

Hey so with this analysis hiw best could it be traded?

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Nhan says

Thank you

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Sumantra kumar halder says

Great

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Austen says

Great job

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