Can he stay on top of the new trading weekThe USDJPY has spent the last 8 weeks below 100 and 200 week MAs (blue and green lines in the chart below). Two weeks ago, the pair has stalled at the new year, the low — output of the April 16 week low at 108.12.
A week ago, the low for the week, has stalled at 108.09 — just below the former low of the year and closed near the high, but below the MAs.
This week, the low was 110.99. 100 MY week was 11 pips above at 111.10. The first 3 hours of the trading week traded below 100 MA week and on the FOMC day this week, there was a liquidity dip (at least on my chart), which saw the price dip to less than a minute below the level (it may have been widespread), before the outbreak of the most high. That move to the upside took the price above the 200 MA week, as well as to 111.64.
When a couple moves back above the 100 and 200 bar MA, I pay attention. He turns the technical bias is bearish below and bullish above. But, I want to see these levels too. I want to see the price stay above, so that the bias can remain bulllish and may be more doubt of the bulls on the bandwagon.
For those who bought the break, they also have an interest to see the level become support. In the new trading week, to stay above the weekly 200 MA at 111.64 is the most bullish scenario for the bulls/buyers. For those who are willing to give a little more room to the 100 MY week is going to be in the eyes of the closes of the line in the sand on a dip. Get down below 200-and 100-week MAs switch the bias back to the downside. Bullish idea is thrown out the window trading.
With this point of view, I drill down to the hourly chart, and look what happened (see chart below).
Friday was a day for the USDJPY. The sharp gains on the FOMC meeting of the day have been traced. The sharp decline came on the rhetoric from N. Korea. The USDJPY still seems to react with JPY buying (USDJPY sell) on the current events of the region.
The sale took the pair below its 200-day at 112.12 (see the green line marked D1 MA:200) and briefly below the 100 hour MA too (blue, smooth line currently 111.878).
Note, however, where the fall of the impasse? The 111.647. It is here that 200 of MY week.
The buyers went to the edge of the key support. Looked over. Put their bid in and won the fall.
Now, the buyers are not out of the woods. The high price out of the Friday low, stalled almost 200 days 112.12 and get above this level will be a key step for the bulls in the new trading week. However, the battle lines are drawn.
- On the other side of the coin to stay above the weekly 200 MA at 111.64 (and in the worst case scenario above the weekly 100 MA at 111.10). This is the risk for long.
- On the top get and stay above the 200-day.
Break more trying to get above the trend line on the weekly at 112.75 and then 115.10. The 61.8% of the move down from the 2015 high at 115.60.
If the weekly 200 MA and 100 MA week are broken down, tracing where the pair has come in the last few weeks begins (PS and the 100 days MA and 100 MA week are at almost the same level of 111.10. The key level.
SUMMARY: After 8 weeks below both the 100 and 200-week MAs, the price and closed at the top of each of these moving averages. This action turned the bias more to the downside for more optimism.
Moreover, the price also moved above and 100 days (at the same level as the week 100 MA to 111.10) AND the keeping of the weekly 200 MA on a correction of the day of Friday, 111.64. Bull.
If the pair will go to the continuation of the upward trend, are these levels hold. Failure and his idea of a break of more optimism is a failure.
To help confirm the upside, a return above the 200-day 112.12 will be in the eyes. Get above and stay above it, and the road could go on.