Friday, June 23, 2017

There Is A Possible USD/JPY Drop To 110.50

Although the pair broke out above the resistance trend line, the weekly resistance marked by the Bollinger Bands indicator in the zone around  111.70 – 112.00 proved to be very strong and the pair has been trying to break out above it for five days now.

Meanwhile three bearish bars formed on the daily time frame, which are an unambiguous signal that the pair won’t be able to break out the resistance without a significant correction.

Under these circumstances there is a possibility for a drop and a test of the resistance trend line that was broken out above, before the pair is able to test and break out above the zone around  111.70 – 112.00.

The scenario where the downward trend is renewed appears less probable for the moment, but surprises are always possible.