Daily Price Action
Shares

USDJPY: Keep an Eye on 112.70 – 113.00 Next Week

Shares

Important: I use New York close charts. Click Here to Use My Preferred Broker

USDJPY bulls are on the move today after two consecutive losing days. That said, the pair is once again trading below the 113.15 handle after Wednesday’s 112.51 close.

We looked at the USDJPY on the 13th when prices were teetering on 113.15 just hours before the Fed rate decision and statement. In that post, I pointed out how a daily close below the key level would begin to erase last week’s bull move.

As you can see from the chart below, Wednesday’s 100 pip decline just about did that on its own.

Technical analysis 101 tells us to watch for a retest of 113.15 as new resistance next week. However, there is a 4-hour pattern that may prevent that from happening.

The ascending channel in the chart below broke down during Thursday’s session. We can even see how buyers attempted to prop up prices for 16 hours before they finally gave in to the selling pressure.

Because it’s Friday, I’m not going to entertain a short entry today. I’d rather wait until Monday to reassess the situation and avoid the risk of getting caught on the wrong side of a weekend gap.

For next week, I’m going to keep an eye on the area between 112.70 and 113.00. Any bearish price action in this region would produce a favorable short opportunity.

The next key support comes in near the November lows at 111.00. Keep in mind that we could also see buyers step up at the late-September and mid-October swing lows at 111.60.

As long as prices remain below former channel support on a 4-hour closing basis, I will remain bearish here. I don’t anticipate an extended move given the holiday liquidity drain that is upon us.

Get Free Forex Trade Setups Delivered To Your Inbox! Click Here To Sign Up

USDJPY 4-hour ascending channel

Leave a Comment:

8 comments
Akinfela Olufemi says

Good one. The chart is so insightful. Good job.

Reply
Tijani says

well done.what else can I say?

Reply
Sam says

Hi Justin;

Thanks for the heads up.

Your posts are really helpful.

Reply
Asghar Ali says

You always provide right and informative posts please carry on

Reply
Sabzet says

Great analysis Justin, appreciated!

Reply
Gede says

Good ideal to watch sell signal on TF 4H, and i watching the sell signal also on GBPJPY on TF 4H

Reply
Bolaji Akinwale says

thanks Justin your analysis is great

Reply
Dimitris says

Missed shorting the pair at 113.5, any new lower high will do though. 110 is a nice round number for being a target in 2018.

Reply
Add Your Reply