After the USD/JPY pair touched down a key support level far far away on the forex dance floor (116) on August 24th market panic, it seems to be looking for a way back up to the previous levels of 124. The truth? It ain’t easy. From what we know from the pair’s characteristics, they love to dance in a range after finding a “comfort zone.” And boy oh boy, have they found a new comfort zone! Getting a little help from our friend Mr. Fibonacci, it appears that the pair could continue dancing between the 23% and 61% Fibo levels until it finds a way to escape; say Japan’s quantitative easing or US interest rate hike or something.
On the daily chart, it is safe to say that Ichimoku indicator is not reliable at the moment, however shorter time frames such as 4 hour charts could get a tip or two from Mr. Ichimoku (i.e. consolidation with a chance of bull.)
The pair broke above a previously identified triangle pattern and we could see up moves towards 121.65 and 123 in extension. Support levels are set at 119.50 and 118.20.
Supports and resistance levels
|Support Levels||Turning Point||Resistance Levels|
*Important Note: The support and resistance levels are not suitable for all traders and largely depend on your account size, margin and leverage. Book a private lesson to learn how to personalize your account based on our trading guide.