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Market Analysis

Interday technical analysis of USDJPY

June 10, 2019
BY Michael Stark

Looking at the four-hour chart of dollar-yen (USDJPY), a recent upward movement with volatility is evident. As part of this direction, two significant areas can be identified on the chart. The first is a support around 107.80 and the second a resistance at around 109.90.

Technical indicators on USDJPY H4

Turning to technical indicators, price has recently tested areas above the 50-period simple moving average. However, no sustained movement above this area has been observed yet. Price is also significantly below the 100- and 200-period SMAs. It is possible that the 100 SMA might also function as a first level of resistance at around 109.10 if a break above the 50 SMA occurs.

Stochastics (15, 5, 5) do not currently suggest a clear signal. However, the main line has moved into the overbought zone, and the signal line at 72 is close to this area. At the same time, MACD (12, 30, 9) has moved upward in line with price overall. The histogram currently gives a positive reading. Bollinger Bands (20, 0, 2) contracting recently suggests that this symbol might be entering a period of retracement and lower volatility.

Price action and Fibonacci

Recent price action on this timeframe reflects a degree of instability for this pair despite the overall upward movement. The long tails of many recent candles and a doji in the previous period indicate indecision. This might mean a lack of significant momentum in either direction. The current candle could display an upward rejection; however, this pattern is still in the process of forming.

Fibonacci retracement areas based on the latest downward movement appear to suggest the strength of 109.10 as a resistance. This figure is within the area of the 61.8% retracement level as well as the 100 SMA. Furthermore, the 38.2% level coincides approximately with the 50 SMA, so traders could consider current prices as an area of resistance being tested.

Technical analysis USDJPY: summary

On the whole, technical analysis of dollar-yen suggests a continuing though small upward movement amid relatively lower volatility. Conversely, traders should monitor the fundamentals of this pair for context, especially around key areas.

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