Published On: Fri, Feb 24th, 2017

USD/JPY: decreasing demand for dollar

InstaForex

Current trend

The US currency is losing ground against the yen and is committed to strong support at 111.75. The main catalyst for the rapid fall of the dollar was negative stats on the US labor market. From the technical point of view, the breakdown of the key support level of 112.65 pushed the pair down. Today, the economic calendar is almost empty, although the volatility is surprisingly high – all due to the high liquidity of the instrument.

Support and resistance

Technical indicators confirm the forecast of fall: MACD shows a sharp increase in the volume of short positions, and Bollinger Bands turned down. On the daily chart the price has broken down the middle line and rushed to the bottom line (111.75). It is worth noting that after reaching the bottom of the descending channel a correction to levels of 112.45, 112.65 would be possible, and then the pair will go down again.

Support levels: 112.00, 111.75, 111.30, 110.50, 110.00, 109.10.

Resistance levels: 112.65, 112.95, 113.50, 113.75, 114.00, 114.35, 115.00.

Trading tips

Pending short positions could be set at the levels of 112.45, 112.65 with the targets at 111.75, 111.00 and stop loss at around 113.20.

Forex Analysis

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