USDJPY At Risk Of Breaching Key Support Level

by at FXTM.
Tran Dai Phat
Tran Dai Phat

Is there a play on the USDJPY pair?

Some technical pointers suggest something interesting is happening…

The USDJPY pair on the Daily Chart has been in a downtrend since 8 October 2020 when it registered the high price at 106.098, followed by a series of lower tops and lower bottoms.

On 29 October 2020, the USDJPY currency pair recorded the low price of 104.014.

Technical Signals

When applying Oscillator Analysis to the price chart, one can see that price is trading below the SMA 60 period Moving Average line, a fact which confirms the USDJPY currency pair’s downward direction.

Furthermore, the Moving Average/Convergence Divergence (MACD) Oscillator is recording values below the zero line which hints to the bearish bias of financial instrument.

Additionally, the Relative Strength Index (RSI) Oscillator registers values below the fifty line which indicates negative sentiment.

All three technical indicators are in agreement with regards to the downward bias of the pair.

Price Targets

Three price targets may be calculated upon applying the Fibonacci tool to the price chart.

  1. The first price target is estimated at 104.587 (161.8%).
  2. The second price target is seen at 103.876 (261.8%).
  3. The third price target is projected at 102.725 (423.6%).

The Japanese Yen is currently trading below the downtrend line, and the presence of the Bearish Shooting Star pattern hints at a potential rally to the downside.

Of course, supply and demand as well as the crowd sentiment will determine the future course of the Yen.

USDJPY Daily 5th Nov

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