USD/JPY Post-Fed Bounce Still Ongoing
The week opened with pain in USD/JPY as the pair tested below the 140.00 level for the first time in a year. But, as looked at in these notes, USD/JPY held support at a big spot of longer-term interest, from 139.28-140.30, and prices started to bounce.
There was then the slow and steady build of higher-lows in the pair, first with a 140.30 bounce and then on the afternoon of FOMC, higher-low defense above that price. Bulls chewed through resistance at prior support of 141.69 and then made their way up for a re-test of 143.45.
Another higher-low developed overnight with a defense of 141.69 and at this point, bulls have an open door to push up to the descending trendline that's still confluent with the 145.00 psychological level.
The fundamental backdrop is not bullish here but fundamentals are not a direct driver of price: Supply and Demand is. And the fact that this is bouncing suggests that previously-oversold dynamics in the pair are continuing to settle and the big question now is whether bears re-enter the equation anytime soon, or whether there's more short-cover to go.
Of note, there's also now a possible falling wedge in the mix and if that breaks, the scope for bulls could continue above 145.00. - js
There was then the slow and steady build of higher-lows in the pair, first with a 140.30 bounce and then on the afternoon of FOMC, higher-low defense above that price. Bulls chewed through resistance at prior support of 141.69 and then made their way up for a re-test of 143.45.
Another higher-low developed overnight with a defense of 141.69 and at this point, bulls have an open door to push up to the descending trendline that's still confluent with the 145.00 psychological level.
The fundamental backdrop is not bullish here but fundamentals are not a direct driver of price: Supply and Demand is. And the fact that this is bouncing suggests that previously-oversold dynamics in the pair are continuing to settle and the big question now is whether bears re-enter the equation anytime soon, or whether there's more short-cover to go.
Of note, there's also now a possible falling wedge in the mix and if that breaks, the scope for bulls could continue above 145.00. - js
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.