Japanese Yen: USD/JPY (JPY=X) – US Dollar Looking for a Bottom Against Yen

Japanese Yen: USD/JPY (JPY=X) – US Dollar Looking for a Bottom Against Yen

Japanese Yen: USD/JPY (JPY=X) – US Dollar Looking for a Bottom Against Yen

The US dollar has pulled back a bit during the trading session on Tuesday as we continue to test the ¥107 level. Ultimately, this is a market that I think will eventually have to make up its mind as to whether or not it is going to break down or not, but from a longer-term standpoint I also believe that we could be looking at a scenario where the market is trying to carve out a larger consolidation area.

I believe that ¥107 is crucial, and therefore could offer a significant amount of support, but even if we break down below there then I think we find support below at the ¥105 level. At this point, the market looks as if it is trying to figure out where the bottom part of the range is going to be but it’s obvious that the ¥112 level is most certainly massive resistance.

Looking at the chart, it appears that we will be making a relatively significant statement over the next couple of days as to where we are going, due to the ¥107 level being crucial. If the market was to break down below the ¥107 level, then I would be short of this market for a couple of handles. On the other hand, if we bounce from here, we could see a move towards the ¥109 level rather quickly. I think this is simply a matter of the market trying to figure out the risk range in this current environment which of course is a completely fluid situation. Ultimately, this is a market that has a handful of major levels that we should pay attention to.

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 110.51.

The projected lower bound is: 103.61.

The projected closing price is: 107.06.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 21 white candles and 27 black candles for a net of 6 black candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 11.7162. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 4 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 42.98. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 26 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -127.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 14 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 2 period(s) ago.

Rex Takasugi – TD Profile

FOREX JPY= closed down -0.090 at 107.110. Volume was 54% below average (consolidating) and Bollinger Bands were 27% wider than normal.

Open     High      Low     Close     Volume___
107.200 107.210 106.910 107.110 49,287
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 108.21 108.61 108.32
Volatility: 9 21 12
Volume: 133,879 133,972 97,982

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX JPY= is currently 1.1% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of JPY= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on JPY= and have had this outlook for the last 6 periods.

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