USD/JPY: the instrument is correcting

Current trend, The US dollar showed growth against the Japanese yen on Wednesday, reinforcing the “bullish” signal, formed the day before. As there was lack of key economic releases, JPY was traded under the influence of technical factors.

Published on Wednesday, macroeconomic statistics from the United States could not provide significant support to the dollar. Initial Jobless Claims increased from 221K to 224K in a week, with a forecast of a decline to 215K. Durable Goods Orders in October fell by 4.4% MoM after the decline by 0.1% MoM in September. Experts expected a decrease of 2.5% MoM.

Support and resistance

Bollinger Bands in D1 chart demonstrate flat dynamics. The price range consolidated in fairly spacious boundaries and does not contradict to the further development of the “bullish” trend. The MACD indicator tends to reverse into the ascending plane, but at the moment it keeps its previous sell signal (the histogram is below the signal line). Stochastic reversed upwards and reflects enough potential for the development of an uptrend in the short and/or ultra-short term.

One should wait for confirmation of the correctional growth signals from MACD.

Resistance levels: 113.18, 113.37, 113.63, 113.83.

Support levels: 113.00, 112.71, 112.29, 111.82.


Trading tips

To open long positions, one can rely on the breakout of 113.18. Take profit — 113.83 or 114.07. Stop loss — 112.90.

The return of “bearish” trend with the breakdown of the level of 112.71 may become a signal for the return to the sales with target at 112.00. Stop loss — 113.00.

Implementation period: 2-3 days.



Timeframe Intraday
Recommendation BUY STOP
Entry Point 113.20
Take Profit 113.83, 114.07
Stop Loss 112.90
Key Levels 111.82, 112.29, 112.71, 113.00, 113.18, 113.37, 113.63, 113.83


Alternative scenario


Recommendation SELL STOP
Entry Point 112.65
Take Profit 112.00
Stop Loss 113.00
Key Levels 111.82, 112.29, 112.71, 113.00, 113.18, 113.37, 113.63, 113.83

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