Currently flat on the USD/JPY...
Weekly gain/loss: +0.57%
Weekly closing price: 112.16
The USD/JPY has spent the past three weeks plunging from weekly supply at 115.50-113.85. This sustained decline erased October’s gains and punched in a low of 110.84. Last week’s action, however, ran into unexpected support and consequently molded a relatively nice-looking weekly bullish engulfing candle. Is this sufficient enough to inspire buyers this week?
Elsewhere, daily action shows that price concluded the week closing between a daily supply zone fixed at 112.78-112.43 and a daily support level at 111.66. In order for the weekly bullish engulfing formation to function, the noted daily supply must be ingested beforehand. Beyond this supply, we have daily resistance at 114.37, shadowed closely by a tasty-looking daily Quasimodo resistance at 114.95, on the radar.
A brief look at recent dealings on the H4 timeframe reveals that the candles whipsawed above October’s opening level at 112.64 and crossed swords with the underside of a H4 supply base at 113.14-112.86. Shortly after, the pair fell sharply after reports emerged that Michael Flynn, Trump’s former national security advisor, will testify against Trump. The 112 handle suffered a nasty whipsaw in response, with H4 price only finding refuge once connecting with H4 demand pegged at 111.37-111.56.
Suggestions: Since H4 price closed back above 112 on Friday, as well as the market chalking in a weekly bullish engulfing candle, scope for further buying up to October’s opening level is a possibility. With that being said however, daily supply at 112.78-112.43, although suffered a minor breach on Friday, is not yet out of the picture, and therefore could subdue buying this week.
In light of the daily supply, our team has concluded that while a rally may take place from 112, it is just not a trade we’d feel comfortable involving ourselves in knowing that we’re buying into a daily area. As such, opting to remain on the sidelines may be the better alternative, at least for today.
Data points to consider: US factory orders m/m at 3pm GMT.
Weekly closing price: 112.16
The USD/JPY has spent the past three weeks plunging from weekly supply at 115.50-113.85. This sustained decline erased October’s gains and punched in a low of 110.84. Last week’s action, however, ran into unexpected support and consequently molded a relatively nice-looking weekly bullish engulfing candle. Is this sufficient enough to inspire buyers this week?
Elsewhere, daily action shows that price concluded the week closing between a daily supply zone fixed at 112.78-112.43 and a daily support level at 111.66. In order for the weekly bullish engulfing formation to function, the noted daily supply must be ingested beforehand. Beyond this supply, we have daily resistance at 114.37, shadowed closely by a tasty-looking daily Quasimodo resistance at 114.95, on the radar.
A brief look at recent dealings on the H4 timeframe reveals that the candles whipsawed above October’s opening level at 112.64 and crossed swords with the underside of a H4 supply base at 113.14-112.86. Shortly after, the pair fell sharply after reports emerged that Michael Flynn, Trump’s former national security advisor, will testify against Trump. The 112 handle suffered a nasty whipsaw in response, with H4 price only finding refuge once connecting with H4 demand pegged at 111.37-111.56.
Suggestions: Since H4 price closed back above 112 on Friday, as well as the market chalking in a weekly bullish engulfing candle, scope for further buying up to October’s opening level is a possibility. With that being said however, daily supply at 112.78-112.43, although suffered a minor breach on Friday, is not yet out of the picture, and therefore could subdue buying this week.
In light of the daily supply, our team has concluded that while a rally may take place from 112, it is just not a trade we’d feel comfortable involving ourselves in knowing that we’re buying into a daily area. As such, opting to remain on the sidelines may be the better alternative, at least for today.
Data points to consider: US factory orders m/m at 3pm GMT.
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