- Daily and 1H: The USD/JPY pair has been in sideways consolidation. You can see channel in the daily chart formed roughly between 95 and 88. However the market seems to have topped before reaching 93.
- If today closes without much USD/JPY rally, it may provide a bearish signal with an engulfing pattern . This accompanied by the negative reversal suggests at least a swing projection towards 88.30.
- The 1H time-frame shows the rally in a channel.
- The strength of today's decline suggests there is more to come, and the reversal scenario is more likely then the continuation scenario in the near-term.
- So bearish signals are lined up, but in the near-term we see some support at 91.50. If the market then breaks below 91.50, it may continue to 88.30 with an area of interest at 90.00.
Fan Yang Currency Analyst Commodity Trading Advisor