Simple Moving Average(SMA) 50-period (red), 200-period (bold, gray)
RSI-14 with Simple Moving Average 5-period of RSI attached.
Elliott Wave Principles
Market and Price Action (patterns, candlesticks)
Intraday pivots and Intermediate-term support and resistance
Multiple Time-frame Analysis
- The USD/JPY declined to 81.08 last Friday before breaking above the bottoming action it had been trying to establish.
- The breakout passed an event risk, suggesting the USD has been oversold and is now resilient.
- The RSI broke above 70, and price action broke above 82.00 sharply. Since the start of the week, we saw the USD/JPY attempt to break last week's high.
- With a bearish divergence in the RSI, it is failing to break above, and has returned lower possibly developing a double top.
- A double top would suggest reversal, which would be a throwback for us to monitor.
- The throwback should not break back below 81.63 (61.8% retracement) level, and the RSI should stay above 40. Then on a rally, the market would have confirmed the basing action from last week, and a rally towards 83.20, then 84.50.
- The 4H chart below shows that the current high is indeed an important resistance level with 61.8% retracement and 200SMA right under 82.50.
- If it can stay above 81.63.
- If the market rallies back above 82.50, it is likely to see resistance between 83.00 and 83.30, the former being the triangle resistance, and 83.30 being a flat resistance and previous high.
Has the USD/JPY Bottomed? We would love to hear what you think.
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Fan Yang CMT
Chief Technical Strategist