USD/JPY Is Attempting A Third Test Of The Support At 112. 00 – 111.60

My prognosis for USD/JPY wasn’t as correct as it was for the GBP/USD and USD/CHF pairs.

Although FOMC raised the interest rate the USD dropped sharply and the pair fell with over 160 pips during the news, while the entire drop from the high at 115.49 (on the 10th March 2017) so far has been over 300 pips.

At the moment the USD has reached a strong support zone around 112.70 – 112.40, and if it breaks out below it, the next support zone to the downside is at 112.00 – 111.60.

Whether the pair will break out below it too is difficult to tell at the moment.

In case it does break out below both support zones, I think the move to the downside could continue to 108.50 – 108.00.

As we know, however, when the price tests one zone three times and fails to break out above or below it, it usually rebounds from it and sharply moves in the opposite direction. That is why it is important to see what will happen during this third test of the support zone.