Technically, longs above 112 may be fragile.
USD/JPY:
Monthly timeframe:
Partially altered outlook from previous analysis –
Since kicking off 2017, USD/JPY has been busy carving out a descending triangle pattern. The breakout for this configuration is common to the downside, but an upward breakout is considered more reliable and profitable.
Outside of the current pattern, a supply area is visible at 126.10/122.66, while lower on the curve we have a demand area at 96.41/100.81.
In recent movement, price elbowed a touch outside the upper boundary of the aforementioned descending triangle.
Currently, the pair trades +3.40% on the month.
Daily timeframe:
Partially altered outlook from previous analysis –
Wednesday’s 150-point advance jumped through channel resistance (109.48) and reached highs of 111.59. Thursday capitalised on recent upside, journeying to highs at 112.22 and linking with channel resistance (red) from 108.47, and supply at 112.66/112.08.
Recent moves higher also formed a ‘rally-base-rally’ demand at 109.52/109.99.
H4 timeframe:
Supply at 111.68/111.42 made way yesterday, consequently unfastening the door to a supply area seen at 112.63/112.25.
Both noted zones are in focus on this scale, though the supply has backing from the daily supply/channel resistance combination and the upper edge of the monthly descending triangle pattern.
H1 timeframe:
Despite closing higher Thursday, the majority of the day’s gains were seen amid Asia and early Europe. US hours entered into a consolidation around the 112 handle, which, as of current price, is seen holding a touch above the psychological base.
Interestingly, the RSI indicator demonstrates bearish divergence (black line).
Direction:
Knowing we’re trading from daily supply at 112.66/112.08, monthly structure as well as within striking distance of H4 supply at 112.63/112.25, breakout longs above 112 may struggle. In its place, traders could be watching H1 price for signs of selling, such as a break of 111.70, or a decisive break beneath 112 followed up with a successful retest.
Monthly timeframe:
Partially altered outlook from previous analysis –
Since kicking off 2017, USD/JPY has been busy carving out a descending triangle pattern. The breakout for this configuration is common to the downside, but an upward breakout is considered more reliable and profitable.
Outside of the current pattern, a supply area is visible at 126.10/122.66, while lower on the curve we have a demand area at 96.41/100.81.
In recent movement, price elbowed a touch outside the upper boundary of the aforementioned descending triangle.
Currently, the pair trades +3.40% on the month.
Daily timeframe:
Partially altered outlook from previous analysis –
Wednesday’s 150-point advance jumped through channel resistance (109.48) and reached highs of 111.59. Thursday capitalised on recent upside, journeying to highs at 112.22 and linking with channel resistance (red) from 108.47, and supply at 112.66/112.08.
Recent moves higher also formed a ‘rally-base-rally’ demand at 109.52/109.99.
H4 timeframe:
Supply at 111.68/111.42 made way yesterday, consequently unfastening the door to a supply area seen at 112.63/112.25.
Both noted zones are in focus on this scale, though the supply has backing from the daily supply/channel resistance combination and the upper edge of the monthly descending triangle pattern.
H1 timeframe:
Despite closing higher Thursday, the majority of the day’s gains were seen amid Asia and early Europe. US hours entered into a consolidation around the 112 handle, which, as of current price, is seen holding a touch above the psychological base.
Interestingly, the RSI indicator demonstrates bearish divergence (black line).
Direction:
Knowing we’re trading from daily supply at 112.66/112.08, monthly structure as well as within striking distance of H4 supply at 112.63/112.25, breakout longs above 112 may struggle. In its place, traders could be watching H1 price for signs of selling, such as a break of 111.70, or a decisive break beneath 112 followed up with a successful retest.
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