USDJPY Presses Resistance Ahead of BoJ- Support at 108.87
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Talking Points
USDJPY weekly opening range break triggers topside scalp bias
Key resistance in view ahead of Bank of Japan
USD/JPY Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
USDJPY approaching yearly highs / key resistance ahead of BoJ / November open
Resistance at 109.52/59- Breach targets resistance objectives at 110.08 & 110.50
Support at October trendline, 107.63, 106.24 & 105.88
Key support / broader bullish invalidation 105.44/57
Daily RSI reversal ahead of 40 / 60-breach – constructive
Multiple momentum resistance triggers pending- look for reaction
Event Risk Ahead: Japanese Jobless Rate, CPI & Bank of Japan Rate Decision tonight and US Personal Income/Spending & University of Michigan Confidence tomorrow
USD/JPY 30min Chart
Notes: The USDJPY is trading within the confines of a well-defined Andrew’s Pitchfork formation off the October lows with a clear break of the weekly opening range yesterday (post-FOMC) shifting the focus to the topside. The rally has now taken the pair into key resistance just shy of the 2014 highs. Long exposure is at risk heading into 109.52/59 with a breach (on a close basis) needed to maintain our topside scalp bias.
Bottom line: Look for short triggers ahead of 109.60 with a move sub-108.87 / pitchfork support offering further conviction for our near-term scalp bias. A breach above 109.60 invalidates the short-bias with such a scenario eyeing the 2014 high at 110.08 and beyond. Caution is warranted heading into key event risk with the Japanese jobless claims, inflation and the Bank of Japan interest rate decision on tap this evening. Follow the progress of trade setups like these and more throughout the trading week with DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets | Timeframe | Level | Technical Relevance |
Resistance Target 1 | Daily / 30min | 109.52/59 | 88.6% Retracement / October Open |
Resistance Target 2 | Daily / 30min | ~109.80 | ~Pitchfork Resistance |
Bearish Invalidation | Daily / 30min | 110.08 | 2014 High |
Break Target 1 | Daily | 110.50 | August 2008 High Day Close |
Break Target 2 | 30min | 111.00/17 | Big Figure / 2.618 Ext |
Support Target 1 | Daily / 30min | 108.87 | 2014 High Day Close |
Bullish Invalidation | 30min | 108.36 | Weekly ORH / Pitchfork Support |
Break Target 1 | 30min | 108.00 | Big Figure |
Break Target 2 | Daily / 30min | 107.63 | 50% Retracement / Weekly ORL |
Break Target 3 | 30min | 107.38/40 | 61.8%v Ext / Sept & Oct Swing High(s) |
Break Target 4 | 30min | 107 | Big Figure |
Break Target 5 | 30min | 106.66 | Soft Support / Pivot |
Break Target 6 | Daily / 30min | 106.23 | 10/21 Low |
Break Target 7 | 30min | 105.88 | October Low Day Close |
Break Target 8 | Daily | 105.45/57 | 50% & 61.8% Retrace(s) / Jan Highs |
Daily (20) | 94 | Profit Targets 21-24pips | |
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
---Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
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