USD/JPY

USD/JPY: USD is strengthening

Current trend. USD showed significant growth against JPY on Monday, having updated local lows of November 15.

JPY is under pressure from weak preliminary data on Manufacturing PMI. In November, instead of the expected growth, the indicator fell again from 52.9 to 51.8 points, which is the worst figure in the last four months. In addition, on Monday, investors paid attention to the data on indices of coincident and leading indicators. In September, the index of coincident indicators fell to 114.4 points against 115.6 points last month. Analysts had expected a decline to 114.6 points. The index of leading indicators also fell from 104.5 to 104.3 points, which, however, turned out to be better than the forecast of 103.9 points.

Support and resistance

Bollinger Bands in D1 chart demonstrate flat dynamics. The price range narrows from above, reacting to the “bearish” start of trading in the Asian session on November 27. MACD indicator is growing keeping quite stable buy signal (located above the signal line). Stochastic keeps its upward direction but is approaching its maximum levels, which reflects the overbought USD in the ultra-short term.

Existing long positions should be kept until the situation clears up.

Resistance levels: 113.64, 113.83, 114.07, 114.30.

Support levels: 113.37, 113.18, 113.00, 112.65.

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Trading tips

To open long positions, one can rely on the breakout of 113.64. Take profit — 114.07 or 114.30. Stop loss — 113.37.

The development of "bearish" trend with the breakdown of 113.37 or 113.18 may become a signal to start corrective sales with target at 112.65 or 112.40, 112.29. Stop loss — 113.64 or 113.40.

Implementation period: 2-3 days.

 

Scenario

Timeframe Intraday
Recommendation BUY STOP
Entry Point 113.70
Take Profit 114.07, 114.30
Stop Loss 113.37
Key Levels 112.65, 113.00, 113.18, 113.37, 113.64, 113.83, 114.07, 114.30

 

Alternative scenario

 

Recommendation SELL STOP
Entry Point 113.30, 113.10
Take Profit 112.65, 112.40, 112.29
Stop Loss 113.64, 113.40
Key Levels 112.65, 113.00, 113.18, 113.37, 113.64, 113.83, 114.07, 114.30

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