USD/JPY: Weekly technical outlook and review.
Weekly TF.
A huge rally in price was seen last week which saw the market close for week (103.884) just below the weekly supply area at 105.432-104.065. We will definitely begin looking for shorts now and any long positions will need confirmation as we could see some very serious selling take place either this week or the next.
Daily TF.
Ouch, a spike above the daily supply area at 104.104-103.802 has been seen. This likely indicates a lot of the traders who attempted to fade this area with their stop-loss order too close have been stopped out. The path north appears to be relatively clear now up to the daily supply area at 104.831-104.505. However before this area gets hit, we must be prepared for a drop down to at least the daily R/S flip level at 102.713 since pro money may not have enough liquidity to push prices higher from here.
4hr TF.
As already clearly seen on the weekly timeframe, the buyers were on fire for the most part of last week, look at that rally in price, fantastic price movement! Selling interest did begin to surface mid-week around the 4hr supply at 104.104-103.981, however it was not quite enough to stop (what appears to be) an intentional spike above this area and the round number 104 from pro money. This spike likely cleared out most of the sellers around this around this area including us! With most of the sellers consumed around this 4hr supply area, we can likely assume the path north is clear up until the next area of interest (4hr supply at 104.831-104.591) which just so happens to be nearly the same as the daily timeframe, only a little smaller in size.
Even though we are trading below a weekly supply area (levels above) at the moment, we must not ignore the fact that both the daily and 4hr timeframes have potentially cleared the path north for higher prices (deeper into the weekly demand area – see above). However before higher prices are seen, pro money will require liquidity, this liquidity will be in the form of sell orders for their buy orders (the stops pro money have just taken above both the 4hr and daily supply areas are now buy orders, pro money cannot buy into them), so they may need to bring price south enticing traders to join in on the momentum, and fool traders into believing this is the start of a new downtrend from the weekly supply (levels above), once these sell orders come piling in, pro money will buy into these orders bit by bit thus giving them the much-needed liquidity for a further push north and to confuse the crap out of other traders.
However, the question we should all be asking ourselves is where would they likely bring prices down to? We believe it could either be the round number 103 (a P.A confirmation level is set just above at 103.037), or the 4hr demand area at 102.129-102.303, however do bear in mind this is only a guesstimate, and price could indeed drop further.
Pending/P.A confirmation levels:
• No pending buy orders (Green line) are seen in the current market environment.
• The P.A confirmation buy level (Red line) set just above the round number 102 at 102.027 has been removed since price has rallied too far from the entry level for the time being.
• New P.A confirmation buy levels (Red line) are seen just above the round number 103 at 103.037. The reason we have not set a pending buy order here is simply because pro money could either perform a deep test of this level, or ignore this level altogether.
• The pending sell order (Green line) set just below a 4hr supply area (104.104-103.981) at 103.954 has been stopped out.
• No P.A confirmation sell levels (Red line) are seen in the current market environment.
A huge rally in price was seen last week which saw the market close for week (103.884) just below the weekly supply area at 105.432-104.065. We will definitely begin looking for shorts now and any long positions will need confirmation as we could see some very serious selling take place either this week or the next.
Daily TF.
Ouch, a spike above the daily supply area at 104.104-103.802 has been seen. This likely indicates a lot of the traders who attempted to fade this area with their stop-loss order too close have been stopped out. The path north appears to be relatively clear now up to the daily supply area at 104.831-104.505. However before this area gets hit, we must be prepared for a drop down to at least the daily R/S flip level at 102.713 since pro money may not have enough liquidity to push prices higher from here.
4hr TF.
As already clearly seen on the weekly timeframe, the buyers were on fire for the most part of last week, look at that rally in price, fantastic price movement! Selling interest did begin to surface mid-week around the 4hr supply at 104.104-103.981, however it was not quite enough to stop (what appears to be) an intentional spike above this area and the round number 104 from pro money. This spike likely cleared out most of the sellers around this around this area including us! With most of the sellers consumed around this 4hr supply area, we can likely assume the path north is clear up until the next area of interest (4hr supply at 104.831-104.591) which just so happens to be nearly the same as the daily timeframe, only a little smaller in size.
Even though we are trading below a weekly supply area (levels above) at the moment, we must not ignore the fact that both the daily and 4hr timeframes have potentially cleared the path north for higher prices (deeper into the weekly demand area – see above). However before higher prices are seen, pro money will require liquidity, this liquidity will be in the form of sell orders for their buy orders (the stops pro money have just taken above both the 4hr and daily supply areas are now buy orders, pro money cannot buy into them), so they may need to bring price south enticing traders to join in on the momentum, and fool traders into believing this is the start of a new downtrend from the weekly supply (levels above), once these sell orders come piling in, pro money will buy into these orders bit by bit thus giving them the much-needed liquidity for a further push north and to confuse the crap out of other traders.
However, the question we should all be asking ourselves is where would they likely bring prices down to? We believe it could either be the round number 103 (a P.A confirmation level is set just above at 103.037), or the 4hr demand area at 102.129-102.303, however do bear in mind this is only a guesstimate, and price could indeed drop further.
Pending/P.A confirmation levels:
• No pending buy orders (Green line) are seen in the current market environment.
• The P.A confirmation buy level (Red line) set just above the round number 102 at 102.027 has been removed since price has rallied too far from the entry level for the time being.
• New P.A confirmation buy levels (Red line) are seen just above the round number 103 at 103.037. The reason we have not set a pending buy order here is simply because pro money could either perform a deep test of this level, or ignore this level altogether.
• The pending sell order (Green line) set just below a 4hr supply area (104.104-103.981) at 103.954 has been stopped out.
• No P.A confirmation sell levels (Red line) are seen in the current market environment.
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