Technical Analysis – USDJPY on the verge of hitting 155.00 milestone
Overbought signals persist as USDJPY approaches the 155.00 level
Bullish trend expected to hold strong above 151.00
After an explosive bullish session on Monday, USDJPY is now a short distance below the 155.00 psychological level, recording its sixth consecutive week of gains and reaching its highest level since May 1990.
The RSI and the stochastic oscillator are currently losing momentum in the overbought region, flagging a potential slowdown in the market. Due to the substantial price increase in the past week, Japan may consider intervening in the FX market.
However, the daily chart continues to show a strong positive trend, indicating a potential upward continuation.
Beyond the 155.00 number, the pair could experience resistance near the trendline zone of 156.00-157.00, a break of which could cause an acceleration towards the 159.10 territory. The latter overlaps with the 161.8% Fibonacci extension of the November-December downleg.
On the downside, traders might initially pay attention to Tuesday’s low of 153.89. A step below that floor could motivate an extension towards the broken resistance line at 152.65, and the 20-day simple moving average (SMA) at 152.45. Should the sell-off strengthen below 150.80-151.00, the short- and medium-term outlook would shift to neutral, potentially leading to a target around the ascending trendline at 150.00 taken from December’s lows.
Overall, the risk of Japan intervention and the persisting overbought conditions in the market could lead to a loss of impetus for USDJPY in the upcoming sessions. Still, any slowdown would not affect the positive trend in USDJPY unless the bears sink the price below 150.80.Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
