USD/JPY tested the strong resistance zone between 118.60 and 118.75 again but could not break out above it and began dropping sharply. It is possible that the pair has formed a double top, but I think that scenario can be confirmed only after the daily bar closes.
On the daily time frame there are RSI divergences between four highs - 113.531, 114.823, 116.120 and 118.660. If those divergences are valid then I think we can expect a move to the downside below 106.90, although at the moment, given how strong the US dollar is, such a scenario sounds quite optimistic.
On the other hand, if USD/JPY continues rallying the next strong resistance it can encounter is at 120.00.
There could be a breakout of that resistance if risk appetite continues.
ReplyDeleteWell spotted! I'll keep a close eye on it.
ReplyDeleteThat's good to know, thanks.
ReplyDeleteSpot on analysis.
ReplyDeleteGood post!
ReplyDeleteInteresting article, thanks!
ReplyDelete