ICmarkets

USD/JPY technical outlook and review.

FX:USDJPY   U.S. Dollar/Japanese Yen
95 0 0
4hr TF.

The higher picture resembles the following:

• The weekly timeframe shows price is trading around a long-term S/R flip level support at 101.206 with a positive close below yet to be seen.
• Buyers and sellers on the daily timeframe are currently trading within a range with resistance being seen above at 102.713 and daily demand seen below at 100.747-100.967.

The market opened higher at 101.363 with the buyers seen taking full control at the moment. It was reported in the last analysis that price would likely react at the prior (supply) decision point area at 101.400-101.465, a minor bearish reaction was indeed seen, however not quite with the intensity we expected.

Taking the above into consideration we still do believe price is likely going to drop down to the round number 101.000 area sometime this week. However before this happens a rally higher to a decision-point level (resistance) at 101.754 may be seen. The reasoning behind this is pro money will likely want to fool as many traders as humanely possible that a new uptrend is beginning and it is going to take off heading right up to the moon, this way they can use all of those buy orders as liquidity to drop price (use the buy orders to sell into), meanwhile using the same traders’ stops, which are sell orders to begin putting buy orders into the market in small chunks, the reason it would have to be in small chunks is to disguise their real intentions without moving price too much.
Therefore, still be prepared for a price decline, but also remain vigilant to the fact that we may see a rally higher to the 101.754 area beforehand.

Pending/P.A confirmation orders:

• Pending buy orders (Green line) are seen just above the round number 101.000 at 101.020. The reason for setting a pending buy order here is because we are currently trading around weekly and Daily demand areas (101.206…100.747-100.967). We would not normally set a pending order around psychological levels such as these, but since we are in a great higher-timeframe location it is worth the risk.
• No P.A confirmation buy orders (Red line) are seen in the current market environment.


• Pending sell orders (Green line) are seen just below supply (103.294-102.983) at 102.953. A pending sell order was set here due to this being an area where likely unfilled sell orders are.
• New pending sell orders (Green line) are seen just below a decision-point level (resistance, 101.754) at 101.696. The reasoning behind setting a pending sell order here rather than a P.A confirmation sell order is for the simple fact this area is expected to see a nice reaction due to this being the overall area where pro money sellers dropped price lower engulfing multiple lows (101.400/101.227) in the process.
• P.A confirmation sell orders (Red line) are seen just below supply (102-191-102.104) at 102.074. A P.A confirmation order was used here purely for the simple fact we are trading around a higher-timeframe weekly support level at 101.206 meaning we may see a small reaction, but nothing to write home about, hence the need for confirmation!

• Areas to watch for buy orders: P.O: 101.020 (SL: 100.786 TP: Dependent on price approach).P.A.C: No P.A confirmation buy orders are seen in the current market environment.

• Areas to watch for sell orders: P.O: 102.953 (SL: 103.317 TP: Dependent on price approach) 101.696 (SL: 101.862 TP: Dependent on price approach) P.A.C:102.074 (SL: 102.214 TP: Dependent on approaching price action             after the level has been confirmed).
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