USD/JPY 1H Chart 7:00AM 10/12/2012

USD/JPY 10/12/2012 1H chart

This has been a directionless and low volatility week for the USD/JPY. It remained above 78.00, but for the most part remained under 78.50 after falling under it on Monday (10/8). The RSI has tagged 30 and 70, showing sideways momentum in the 1H chart. We are coming to the last 10/12 US session of the week with the USD/JPY coiling in a triangle pattern as it tests the key falling trendline that goes back to April 2012.

Breakouts: The break of the triangle opens up the highs and lows of the triangle. A break above the high of the triangle near 78.60 has more significance than a break below the triangle support pivot near 78.25. The break below 78.25 is just status quo, focusing on recent support pivots at 78.00 down to 77.11, where we meet a major rising trendline going back to the 75.56 record low from Nov. 2011.

A break above 78.60 however introduces a reversal scenario, away from the bottom  USD/JPY seems to have built last year. It opens up the 79.67, 80.61 and 81.76 pivots.

As you can see, the USD/JPY market is also “coiling” in the daily chart.

USD/JPY Day Chart 7:05 AM 10/12/2012

USD/JPY 10/12/2012 daily chart

Fan Yang CMT is the Chief Technical Strategist, trader, educator and a of the main contributors to FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

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