Previous Week Update:
As we can see from the previous week’s analysis update, we did not bounce off the support or last kiss the weekly channel resistance that we broke. With the momentum (Trump problems, links will be added below) we broke through the support and reentered the weekly channel, but we created that lower high we needed for a confirmation of a move to continue lower.
Upcoming USD News:
- Wednesday: Crude Oil Inventories (Still unsure about the effect on the FX markets)
- Previous -1.8M
- Thursday: Unemployment Claims Â
- Previous 232K
- Friday: Core Durable Goods Orders m/m
- Previous 0.0%
- Friday: Prelims GDP q/q
- Previous 0.7%
Monthly: Bullish Pin Bar close –> Lost previous week gains and near the monthly open price.
Weekly: Strong bearish candle (previous week had a larger wick than the body Ã losing bullish strength). Lower highs created and nice weekly wick range formed.
Daily: Consolidation after the big drop caused by Trump. Could form a bearish flag. Bearish if stays under 112 price range.
H4: Consolidation range between 111.500 -110.200. Respecting the H4 bullish trendline and formed an ascending triangle stay under 111.500.
Overall USDJPY Analysis
- We found resistance at 114.300 price area, forming a double top, breaking the neckline then retesting it then continuing the drop.
- The strong bearish momentum was caused by Trump (links are above).
- After the drop, we have created a consolidation range between 111.500 and 110.200.
- In addition, the drop respected the h4 bullish trendline, and now price is forming an ascending triangle.
- A break out either way should dictate the long-term movement.
- If it breaks up, we should see a retest of the 111.500 levels
- However, for if the bullish trendline breaks and momentum breaks the 110.200 levels, we should see a last kiss at that level before continuing lower.
- Overall, we have created a lower high we needed on the larger timeframe, which makes me confident that we are continuing our UJ bear run again.
- The likely path I see occurring is A
- However, with trump signing the multibillion arms deal with Saudi Arabi there may be a gap up (strengthening the USD)
- Where it could continue its bearish run with a top wick; B
- Or, this will push price to 113.500; C
- I am waiting till Tuesday, going to wait for clues after Monday’s market structure