USD/JPY: Breakout coming, downtrend continuation?
This pair plunged below the daily 100- and 200MA and has stayed below them for a good 6 weeks now which to me points to the end of the longterm uptrend seen on the weekly charts. We have been in consolidation ever since that significant selloff at the end of August.
Whilst we could stay in this phase for quite a while longer I do think that we could be seeing a breakout within the next 1 to max. 2 weeks. It is however clear that the range is tightening, we also see a BB squeeze and some daily doji's, which could be pointing to the fact that decision time might be near and a breakout could be expected any day now!
On the 4H chart we see that the 200MA could be acting as dynamic resistance (possible rejection on 09-25).
With a beginning downtrend we often see the 100MA testing the 200MA before the trend continues so I will be looking to spot a possible 100MA bounce or small cross-and-back for signs of the downtrend continuation.
The daily RSI is flat but below 50 which could also point to the fact that bears are in charge. I will also be looking for strong RSI rejections of that 50 level.
With all this in mind I think that it will take a lot of bull power to stop this possible new long-term downtrend! I will therefor only look for short opportunities in the near future. But all is possible of course!!
The obvious first target below would be that weekly trendline.
I have not included any trades on these timeframes since I cannot find setups with good enough R/R for the moment. I will therefor be looking at smaller timeframes for confirmation on the breakout direction and possible setups.
Happy trading to all!
Whilst we could stay in this phase for quite a while longer I do think that we could be seeing a breakout within the next 1 to max. 2 weeks. It is however clear that the range is tightening, we also see a BB squeeze and some daily doji's, which could be pointing to the fact that decision time might be near and a breakout could be expected any day now!
On the 4H chart we see that the 200MA could be acting as dynamic resistance (possible rejection on 09-25).
With a beginning downtrend we often see the 100MA testing the 200MA before the trend continues so I will be looking to spot a possible 100MA bounce or small cross-and-back for signs of the downtrend continuation.
The daily RSI is flat but below 50 which could also point to the fact that bears are in charge. I will also be looking for strong RSI rejections of that 50 level.
With all this in mind I think that it will take a lot of bull power to stop this possible new long-term downtrend! I will therefor only look for short opportunities in the near future. But all is possible of course!!
The obvious first target below would be that weekly trendline.
I have not included any trades on these timeframes since I cannot find setups with good enough R/R for the moment. I will therefor be looking at smaller timeframes for confirmation on the breakout direction and possible setups.
Happy trading to all!
