(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; downtrend lines in red; uptrend lines in green; 50-period simple moving average in light blue.)
6/06/2008 – USD/JPY – Depending upon how the downtrend resistance line is drawn on the USD/JPY daily chart, as shown, the pair could have either already hit significant downtrend resistance yesterday (line marked A), or have around 200 pips more to go before it does so (line marked B). In any event, after today’s Non-Farm Payrolls announcement, the A downtrend line was well-respected as price promptly turned back down at resistance. With the displayed Stochastics at or near overbought territory, oscillators are also lending strength to a bearish bias. In this event, the next major support to the downside resides around the 102.50 region, a recent support/resistance zone. In the event of a fundamentally-driven move back up above the A resistance line, on the other hand, price should target further resistance at the B downtrend line.
Chief Technical Analyst
IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors.