USDJPY Outlook | Written by ActionForex.com
USD/JPY's strong rebound from 82.33 suggests that fall from 84.39 is merely a correction and should have completed at 82.33 already. Further rise would now remain in favor as long as 83.43 minor support holds. Break of 84.39 will confirm that whole rebound from 80.29 has resumed and should target 85.92 cluster resistance next. On the downside, below 83.43 will flip intraday bias back to the downside. Also, break of 82.33 will revive the case that rebound from 80.29 is completed and will bring deeper fall towards 80 psychological level again.
In the bigger picture, with 85.92 cluster resistance (38.2% retracement of 94.97 to 80.29 at 85.89) intact, there is no confirmation of reversal yet and the longer term down trend in USD/JPY is possibly still in progress for another test on 79.75 (1995 low). Again, note that downside momentum is clearly diminishing with bullish convergence condition in weekly MACD. We'll continue to focus on reversal signal on next fall.
In the long term picture, there is no indication of trend reversal yet and USD/JPY's long term down trend could still extend further to 1995 low of 79.75. We'd anticipate some strong support from 79.75 initially to bring rebound. Focus will be on whether 79.75 would hold or USD/JPY is indeed resuming the multi decade decline that started back in the 80's.
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