H1 demand at 107.15/107.23 joins with ABCD confluence

FX:USDJPY   U.S. Dollar / Japanese Yen
Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Since kicking off 2017, USD/JPY has been busy carving out a descending triangle pattern between 118.66/104.62. The month of March concluded by way of a long-legged doji candlestick pattern, ranging between 111.71/101.18, with extremes piercing the outer limits of the aforementioned descending triangle formation.

April was pretty uneventful, ranging between 109.38/106.35. May also remains subdued, ranging between 108.08/105.98.

Areas outside of the noted pattern can be seen at supply from 126.10/122.66 and demand coming in at 96.41/100.81.

Daily timeframe:

Brought forward from previous analysis -

Since registering a top from 109.38 at the beginning of April, USD/JPY moulded a falling wedge pattern, which had its upper limit breached on May 11 in strong fashion, boosted by demand at 105.70/106.66. The take-profit target out of the said pattern, traditionally measured by taking the value of the base and adding this to the breakout point (purple), sets an objective of around 109.30.

However, in order to reach the noted take-profit target, the 200-day simple moving average at 108.29 will need to be defeated.

H4 timeframe:

Partially altered from previous analysis -

Structurally, supply at 108.10/107.79 remains present on the H4 timeframe, along with a local demand area at 107.21/107.41, consequently forming a week-long range. A break of the latter advertises moves to support priced in from 106.91, whereas navigating waters above the aforesaid supply could lead to resistance at 108.53 making an appearance.

H1 timeframe:

The tail end of last week, as well as early movement this week, found a home under trendline resistance (prior support – 106.85). USD/JPY , as you can see, swung lower Tuesday, dethroning the 100-period simple moving average and shortly after retesting the value as resistance. Demand is not expected to emerge until reaching 107.15/107.23. Technically, we also have an ABCD bullish correction (orange) in process, terminating within the parapets of the said demand, along with a nearby 61.8% Fib ret level at 107.26.

Structures of Interest:

Daily price displays room to approach the 200-day simple moving average at 108.29 and the falling wedge take-profit target of around 109.30.

H1 demand at 107.15/107.23 is glued to the underside of the current H4 demand found at 107.21/107.41, therefore sellers off the 100-period simple moving average could face opposition from the top edge of H4 demand 107.41.

Despite this, given H1 demand comes with an ABCD correction and a nearby 61.8% Fib ret level at 107.26, noting this level as a buy zone may be an idea.


Nice analysis and descriptions!

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