Saturday, June 17, 2017

USD/JPY Rebounded From 109.00 After All

The support around 109.00 (the lower band of the Bollinger Bands indicator on the weekly time frame) stopped the USD/JPY move to the downside after all>>> . What is more, the rally that followed led the pair to the resistance trend line of the channel (in red), which has been developing since 3rd January 2017 and the pair remains within it.

The daily bar closed as a doji just a little below the resistance trend line of the channel, in which the supposed B wave was developing. Not to mention that the difference between its open and close levels was just five ticks (О – 110.872, C – 110.867). The weekly bar also closed right at the resistance trend line. Such bars, formed at that place, are a signal for a certain amount of indecision on the market.

If the pair breaks out and remains above the resistance trend line next week then the scenario for a rally and the development of another impulse wave to the upside (wave C in red on the weekly time frame screenshot) will become more valid.

In the alternate scenario the pair will move to the downside but it seems less likely for the moment.