USD/JPY reaches long term resistance zone

Since peaking at just over 125.00 in June 2015, the USD/JPY has been trending lower ever since.

Since peaking at just over 125.00 in June 2015, the USD/JPY has been trending lower ever since. This has been highlighted by the series of lower highs and the corresponding long-term bearish trend line which can be seen on the weekly chart, below. But the bearish momentum faded sharply in August 2016 when it found significant support around the 100.00 level. However, that burst of momentum faded again at the trend line, preceding a series of lower lows. The last low in these series of lower lows which was made at around 105.00 – hit earlier this year – was still above the 2016 low of 100.00. Thus, a significant higher low was potentially formed. But for this to become a valid higher low though, the USD/JPY now needs to make a higher high above 114.70. Standing on the way of this level are several resistance levels that are now approaching or being tested, and THAT long-term bearish trend line. Thus, the higher low around 105.00 is a potential higher low for the time being. For all we know, the USD/JPY could very well turn lower again and move below 105.00, and who knows, the previous swing low at 100.00 as well. Given the long-term bearish trend and the lower highs, we are now on the lookout for a bearish sign to emerge on the lower time frames – such as a bearish engulfing candle or inverted hammer on the daily chart – around these levels. The USD/JPY has already entered the lower bound of the resistance zone at 110.85 (old support and 61.8% Fibonacci level). Short-term support comes in at 110.00, followed by 107.80, levels that were formerly support and/or resistance.

Source: eSignal and

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account