The Daily Forecaster: USDJPY
Price: 86.95
Bias: While 87.00-05 (max 87.20) caps I feel we shall see losses extend to 86.25-33 & later 85.54-74
The underlying MT direction is bearish while the daily bias is bearish. Therefore the main risk is lower. Ensure that key resistances levels hold. Note key support levels that would suggest continuation of the bearish move. Consider confirming this with a bearish set up pattern in price an indicator. Only consider a possible larger reversal higher should key MT resistance break and is supported by a bullish set up in price or an indicator.
Consider buy set ups at: 87.40 or 85.54-74 or 84.65-82
Consider sell set ups at: 87.00-20
| Resistance |
87.00-05 |
87.20 |
87.38 |
87.75 |
87.97-18 |
88.45-65 |
| Support |
86.66-71 |
86.25-33 |
85.96 |
85.54-74 |
85.20 |
84.65-82 |
Daily Outlook
The losses from 87.75 appear to be constructive and I still feel we have further to go. This should see the 87.00-05 resistance cap again (max 87.20) and for the downside to make further progress below yesterday's 86.82 low. We have to take some care at 86.66-71 as it could generate a further pullback so take care - but overall this appears to be setting itself up for a retest of the 86.25-33 lows. I suspect a correction from around here but once complete should then extend lower to the 85.54-74 support. Again, a further correction is expected from here.
Therefore, only above 87.20 would threaten the 87.75 high and potentially then the 87.97-18 resistance. Still take care here but with this break it would tend to confirm the double bottom and therefore probably a total recycling back to the 89.14-20 area.
Medium Term Outlook
23rd July:
So far so good but there is still a little way to go and I feel now the 88.20 area should cap to generate the final move down to the 84.65-82 target.
To generate any stronger recovery we probably need a direct break above 88.20 and preferably 88.50-70 which could then retest the 89.14 high and beyond..
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