That is the
question I asked myself at the end of the past trading week and even during the
last hours of the American trading session.
The reason
for that are the first signals for a deeper correction at least, if not a trend
reversal. And those signals are:
- On the W1
time frame the pair has reached a strong support zone around 108.80 –
108.70.
- On the H4
time frame the waves the pair formed to the downside came in threes with a
relatively similar height and are very visible in the two trend channels (in
red and blue).
- On the H1
time frame during the news on Friday and the volatility that followed the pair
formed very typical sharp movements in both directions, which are often the
first signal for a trend reversal.
And, in the
end, a trading idea for next week:
The trend
channel that formed on the H1 time frame has a height of 31 pips and there is a
possibility for that to rise to 38 pips. In case of a breakout there could be a
rally with the same height. After the pair reaches the limit of that rally I
think the pair will retrace for a test of the breakout and it may or may not
reach the trend line, according to the theory. That is when it will become
clearer whether USD/JPY will start moving to the upside or not.
Thank you for the analysis.
ReplyDeleteExcellent observation, thank you for sharing!
ReplyDeleteGood post!
ReplyDeleteGood insight.
ReplyDeleteToo soon to be a trend reversal.
ReplyDeleteBears are still in control.
ReplyDeleteVery interesting information, good.
ReplyDelete