USD/JPY Is Waiting for Economic Data Announcement And Janet Yellen’s Speech To Pick A Direction

A little later today we are waiting for economic data announcement from the USA and after that there will be a speech by FED Chair Janet Yellen - those events will likely give the USD/JPY pair, as well as to many other pairs, a push to pick a side.

Meanwhile, the pair did exactly what I said it would in yesterday’s analysis. The pair formed a small corrective move to the downside, which on one hand aimed to recover the gap, and on the other hand - to reach the resistance trend line the pair broke above, which now has turned into a support.

For the moment, however, one cannot say with great certainty whether the USD will begin moving to the upside after these events, considering the way yesterday’s daily bar closed. The possibility that it will renew its move to the downside seems to be increasing.

If the pair does renew it we can expect it to reach 111.20 – 110.90. In the mean time we should also be watching whether the RSI divergence will deepen, i.e. whether RSI will form a new higher low.
In case USD/JPY renews its move to the upside instead the first target will be around 114.50 – 115.00.