ForexYell
Long

Rising Channel & Ichimoku Cloud Look to Support USDJPY

FX:USDJPY   U.S. Dollar/Japanese Yen
Bias: Bullish Toward Channel Top Near 127

Point to Establish Long Exposure: Into Ichimoku Cloud in the 122.18-123.06 region

Invalidation Level: Channel Low & 100-dma 121.55

Target: 127+


The JPY has strengthened vs. the USD ~0.5% on the weekly open after China's Shanghai Index dropped 8.6% to open the week. However, the risk-off sentiment seems to be contained, as is common in clear trends, while technical indicators, specifically Ichimoku & the Andrew's Pitchfork look to provide support.

Looking for a move to the top of the channel on the FOMC announcement later this week. Resistance will be a focal point for many institutions at 124.40 as it has held and allowed USDJPY             to print a lower high three times since mid-June.

A break and close above resistance will continue to affirm that upside target of ~127.

Protective stops are placed below the lower median line of the pitchfork and a great deal of force would likely be needed to get there in the form of larger Risk-off sentiment from continued deterioration in global equity and commodity markets.

Shorter-term: if the Tenkan-Sen or Conversion line (9-period midpoint) continues to point higher, the bias will remain bullish . If the Tenkan-Sen (black line on chart), turns south, the immediate view will be neutral for larger bias higher.

Other Key levels of Focus:

USD/JPY            
* 3rd resistance: 124.38 76.4% Fib Resistance of Corrective Range
* 2nd resistance: 124.19 Lower high & July 23 high
* 1st resistance: 123.57 July 22 low

* Spot: 123.20

* 1st support: 122.92 55-DMA
* 2nd support: 121.55 Protective Stop & 100-DMA
* 3rd support: 120.51 July 8th low & May 5 high
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