The USDJPY is above 100 day MA. Taking steps higher

The USDJPY has moved above the 100 day MA at the 77.30 level.  Moving above this level is positive for the pair.   The 77.539 is the next target. Traders have been disappointed before in false breaks in the USDJPY, but the move higher today has been more steady (vs a spike). It started by holding the 100 hour MA and has progressed step by step higher.  Nevertheless, it is important to define risk. Risk, as I see it,  comes in at 77.21 which is the 38.2% of the  move higher today (see chart below). 

On the hourly chart today, the price held above the 100 hour MA, then had nice buying above the 200 hour MA.  The 38.2% of the move down from the November high comes in at the 77.213 level.  It broke through this level.  The 50%  comes in at the 77.41.  This is another target (before the 77.539 level) to the upside if this  progression is to continue.

I know the Thanksgiving holiday is approaching and that typically leads to quiet markets, but if there is to be an impact in a currencies move, it can also manifest itself during a more illiquid time period.  The BOJ intervened at the 75.56 area. The high reached 79.52. The move lower took the price below 61.8% of that move.  Now with the price back above the 100 day MA, the bias may be shifting back to the upside.  If shorts start to cover, it could lead to a larger than expected move. Be aware.

USDJPY moves above the 100 hour MA

The USDJPY has moved above the 100 hour MA at the 76.93 level and is pushing toward the 77.00 level. The 77.07 level is hte old support and resistance from the pre-intervention low. The 200 bar MA (green line ) comes in at the 77.15 level The 38.2% of the move down comes in at the 77.21 and the mipoint of the move down comes in at 77.41.  On the downside, a move below the 100 bar MA and the 76.81 level returns the bias back to the bearish side.  We will see if any momentum starts to develop on the move up.

USDJPY Above 79 Approaching 200 day

The USDJPY pair flew up almost 4 big figures as the Bank of Japan intervened and sold Yen. Finance Minister Azumi commented that the move was unilateral although he didn’t elaborate on the size of the intervention. The Finance Minister added that the action was taken to due to strong signs of speculation, his view being that the price of Yen does not all reflect the fundamentals. On the chart below we see the pair is approaching the 200day moving average as it sits on the 38.2% retracement of the move from the March highs.

USD/JPY Hits New All-Time Low Within Bearish Trend Channel

USD/JPY (daily chart) as of Wednesday (10/26/2011) has hit yet a new all-time low below 76.00, reaching down to 75.70 in Wednesday’s trading. This bearish price action conforms to a bearish trend channel that extends back to the early April high around 85.50. The downtrend channel has prompted the pair to drop below successively lower support levels, including the key 80.00 and 78.00 levels. Japanese intervention notwithstanding, further downside momentum below the key 76.00 level within the current bearish trend could see price make its way down towards the 73.00 price level, a significant Fibonacci extension. Potentially more likely, however, price could soon see yet another substantial move to the upside, perhaps triggered by intervention activity, that breaks out above the noted bearish channel and targets the key 78.00 resistance level to the upside once again.

(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)

James Chen, CTA, CMT
Director of Technical Research and Education
FXDD

USD/JPY Drops Further, Continued Intervention Consideration

USD/JPY (4-hour chart) as of Monday (8/08/2011) has continued its steady, yen-strengthening fall after spiking late last week to a high of 80.22 on the heels of intervention by the Bank of Japan. This yen re-strengthening after the central bank’s attempt to weaken the yen essentially indicates that the intervention has had very little lasting impact on the upward trajectory of the Japanese currency. The fact that USD/JPY has dropped below key 78.50 support once again is an important bearish indication. As USD/JPY continues to move to the downside, the risk of further yen intervention continues to loom. The key downside target currently continues to reside around the significant 76.50 support region. Further intervention notwithstanding, USD/JPY could continue its overall downtrend slide. In the event of a subsequent strong breakdown below 76.50, a longer-term target to the downside resides around the 74.00 price region, which is around the 161.8% Fibonacci extension of last week’s bullish correction.

(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)

James Chen, CTA, CMT
Director of Technical Research and Education
FXDD

USD/JPY Spikes then Pulls Back on Intervention

USD/JPY (4-hour chart) as of Thursday (8/04/2011) jumped more than three big figures to poke above the key 80.00 psychological level on the heels of BOJ intervention, before pulling back and settling around the 79.00 price region. This rather swift spike brought price up to approach a key downtrend resistance line extending back to the late April high. Now sandwiched between resistance around 79.50 and support around 78.50, price is currently at a critical directional juncture. A break below 78.50, which would hint at a failed intervention, should target downside support around 76.50 once again. A re-breakout to the upside above 79.50 could potentially target the 81.50 resistance region.

(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)

James Chen, CTA, CMT
Director of Technical Research and Education
FXDD

USD/JPY Consolidates During Bearish Onslaught

USD/JPY (4-hour chart) as of Thursday (7/14/2011) has entered into a consolidation after having broken down decisively below the key 79.50 previous support region (now resistance). The breakdown below 79.50, which was the region of the significant May low, was also a breakdown below the 161.8% Fibonacci extension of the last major bullish correction, and it also follows on the heels of a breakdown below a key parallel uptrend channel that extends back to the early June low. This series of breakdowns highlights the substantial recent weakness in the pair. Now that 79.50 has been broken down, it has already acted as resistance, and continues to serve as a key resistance area. To the downside, the 261.8% Fibonacci extension of the last major bullish correction (around 78.30) has been approached but not yet reached. In the event of a further breakdown below this level, price action could begin targeting further downside support around the 76.50 price region, which represents the approximate bottom of the bearish spike that occurred in mid-March.

(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)

James Chen, CTA, CMT
Director of Technical Research and Education
FXDD

USD/JPY Breaks Down Rising Channel

USD/JPY (4-hour chart) as of Monday (7/11/2011) has broken down decisively below a rising channel that extends back to the early June low. This breakdown occurs after the bottom border of the channel was respected at the very end of last week. A key support target immediately to the downside on this channel breakdown resides around the 79.50 price region, the area of the major low that occurred in early May. To the upside, key resistance within the context of the current bearishness now resides around the 80.50 price region.

(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)

James Chen, CTA, CMT
Director of Technical Research and Education
FXDD

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