Will USDJPY trade lower? Price has rejected a key level of resistance, and could head back to the lows.
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The price of USDJPY has rejected the key resistance level of 134.75. Price has recently broken down through last week’s candle low, showing the momentum is to the downside. This could see prices end up at the weekly swing lows, at 130.75 or 127.50.
Fundamentally, Gross Domestic Product q/q in the US forecast for tomorrow, is expected to fall from 2.6% to 2.0%. We also see the release of Unemployment Claims which is expected to grow from 245k to 247k, which could keep the USD under pressure.
On the H4 chart, we can see that the price has formed a head and shoulders pattern. Now the price has broken through this pattern, we can expect a move lower. If the price heads lower it could reach the 132.00 lows. On the hourly chart, the price has formed a consolidation that has been broken to the downside. This could be another indicator that the price could trade lower and traders could look out for a retest.
The price on the chart has traded through multiple technical levels and some observations included:
- Price has rejected a key level of resistance.
- Price is breaking through a key head and shoulders pattern neckline.
- The hourly chart shows a breakdown in consolidation.
Have you watched our GBPAUD analysis? You can see it here.
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