Daily Price Action
Shares

USDJPY to Move Lower Next Week Following Key Breakdown

Shares

The USDJPY just closed the week below an eight-year trend line.

I mentioned this level on December 9th, where I stated that a weekly close below 103.60 would open the door to 101.00.

That’s the location of the trend line from late 2012.

USDJPY breakdown on the monthly chart
USDJPY monthly time frame

We also looked at how USDJPY reacted to this level on December 15th.

If you’re a lifetime member, you know the December 14th candle was not a bullish pin bar for buying.

In fact, I told DPA members that I was only interested in shorting USDJPY.

There were three reasons why the December 14th candle wasn’t a buy signal.

First, USDJPY has been carving lower highs since February.

Even the massive 1,050 pip rally in March failed to carve a higher high.

As long as those lower highs persist, sellers are in control.

Second, the way USDJPY was “weighing” on the 103.60 area signaled that a breakdown was imminent.

I sometimes call this “heavy price action”.

It can be beneficial in determining whether a market is about to break lower or not.

The third reason why USDJPY hasn’t been a buy is that the pair has been sideways since November.

Any bullish candle like the December 14th pin bar is insignificant without momentum.

USDJPY broke 103.60 on Wednesday and retested the area as new resistance on Friday.

As long as the pair stays below that area next week, I like the idea of looking for shorts.

The move lower is likely to be full of retracements, but I continue to like USDJPY toward 101.00, as I have for months.

Want to Watch the USDJPY Video I Just Released to Members?

Get a Lifetime Membership Today and receive exclusive member-only content including one to two new videos every day. Save 40% in December!

USDJPY daily time frame

Leave a Comment:

7 comments
Justin Bennett says

Want me to help you become a better Forex trader?

Get a Lifetime Membership to Daily Price Action today and receive access to Justin’s full price action course, dozens of forums with over 4,000 members, daily videos of trade ideas, direct access to Justin, and much more!

Save 40% on a lifetime membership in December!

Reply
MARTIN MAINA says

THANKS MAN. EURAUD,EURNZD YOU HAVE IGNORED THE AIR AND ARE SHORTING WELL

Reply
kelechi says

Thanks boss! I really appreciate

Reply
Hany Gabr says

i already short on usd/jpy in friday , i hope to know when to add to this position

Reply
Jeff says

I am already in a long trade of the eurusd. Is it wise then to take ashort trade in usdjpy? It can ends in 2x profit but also in 2x loss. Or is n’t it not the case here?

Reply
Karisa Kimera says

Thank you! Very helpful analysis

Reply
Outrageous says

I don’t know where and how I came across this forecast but as someone who consistently earns 8-10 %/month from forex I can say it is beyond ridiculous . If I traded that way I wouldn’t have never been profitable.

Reply
Add Your Reply