USD/JPY Gaining Momentum Off Range Lows

By DailyFx | Updated July 25, 2014 AAA

DailyFX.com -

Talking Points

  • Testing key resistance zone
  • Cyclical picture turning more positive

Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.

Trading in USD/JPY has been frustrating (to say the least) over the past few months as the rate has been locked in a contracting range above 100.75. The cyclical outlook of the exchange rate, however, suggests that this regime could be about to change as several important relationships converged around the time of the month-to-date low at 101.05. Admittedly momentum has been lacking since that low, but the rate has begun to show some signs of life over the past few sessions with a break above a couple of key Gann lines in the 101.80 area (see chart below). A daily close above this level will be a strong first step, but the month-to-date high at 102.25 really needs to be overcome to signal to us that something more important is indeed developing on the upside. Any weakness back under 101.05 would invalidate this burgeoning positive view.

To receive other reports from this author via e-mail, sign up to Kristian’s e-mail distribution list via this link.

USD/JPY Daily Chart: July 25, 2014

USD/JPY Gaining Momentum Off Range Lows

Charts Created using Marketscope – Prepared by Kristian Kerr

Key Event Risk in the Sessions Ahead:

USD/JPY Gaining Momentum Off Range Lows

LEVELS TO WATCH

Resistance: 102.00 (Psychological), 102.25 (MTD high)

Support: 101.35 (Gann), 101.05 (MTD low)

Strategy: Buy USD/JPY

Entry: More aggressive traders can look to buy on a daily close above 101.80, while more cautious traders can wait for a move through 102.25 to position.

Stop: 1-day close below 101.05

Target: Open

Related Forex Analysis
  1. US Dollar Technical Analysis: Buyers Poised to Extend Advance
    Forex News

    US Dollar Technical Analysis: Buyers Poised to Extend Advance

  2. Stay with the trend – TD Securities
    Forex News

    Stay with the trend – TD Securities

  3. USD/JPY Technical Analysis: Bearish Reversal in the Works?
    Forex News

    USD/JPY Technical Analysis: Bearish Reversal in the Works?

  4. EUR/USD Technical Analysis: Aiming to Clear November Low
    Forex News

    EUR/USD Technical Analysis: Aiming to Clear November Low

  5. GBP/USD Technical Analysis: Looking to Confirm Reversal
    Forex News

    GBP/USD Technical Analysis: Looking to Confirm Reversal

Trading Center