USD / JPY – A REBOUND BEFORE FURTHER CORRECTION?
Mis à jour
My analysis today deals with how the further course of our popular forex pair "USD / JPY" could look like.
> The technical analysis and selected indicators, confirm the thesis of an imminent correction.
= Why, that I explain after the introduction.
The DXY / USD has a non-negligible impact on USD / JPY, as the whole economy depends on its behavior.
> Meanwhile, this seems to take run-up, for a final upswing, which could bring the precious metal under massive selling pressure.
> Regardless of these selling pressures coming from the USD, SILVER has been somewhat caught at a very strong resistance, which foreshadows a falling price.
In the following, the analysis goes into detail, so that the significant levels and areas are known to you.
For this purpose, I have performed a "MULTI-TIME-FRAME" analysis, which refers to the higher time units (month & week) and thus makes the big picture visible.
Normally all time units below "1h" are called noise, but even a - 1h-4h - analysis is of no use to you, if the knowledge about the big and whole is missing.
> We traders know that no one can predict the future, and that is exactly why you have to be prepared for all initial situations.
> If the DXY should rise again, that means "BLOOD" for the traditional and crypto markets.
> This creates dangers, but also opportunities - it is important to look at the big picture.
> Which levels are RELEVANT, I have explained in detail in the following pages.
Table of contents
1st part = INTRODUCTION
2nd part = TECHNICAL ANALYSIS
= Monthly - Time frame
= Weekly - Time frame
3rd part = CONCLUSION
PART ONE
"INTRODUCTION"
After the "USD/JPY" formed a top at USD 152 in October|2022, a sharp sell-off has been unleashed thereafter.
> This sell-off extended until today and could have reached its end.
> By could, I mean that there is still room to correct here. The correction can potentially run to 124 USD, where we would encounter a sideways channel. This showed its effect since 1987 and would be a strong support.
> The Fibonacci tool confirms us the possible end of the correction, by successfully working through the "golden pocket" (0.618 + 0.65 FIB)
= In addition to the sideways channel just mentioned, we are at the center line, of another channel, which led the previous upward movement since the year 2021.
> The downward movement is in a downward channel on the smaller time units (daily >) since December|2022 and shows a strong divergence in the daily MACD, which indicates a temporary end of the correction.
> Once you look at the DXY (USD index) at the higher time levels, the further sell-off in the traditional markets becomes even more likely.
(My DXY analysis is linked below this post, for confirmation purposes).
SECOND PART
TECHNICAL ANALYSIS
For the analysis of the higher time levels, I proceed according to the onion-skin principle.
> MONTH - level > WEEK - level > DAY - level
These are divided into
> SUMMARY > CHARTS
The charts are presented in logarithmic scaling, as the given information can be visually presented in a more harmonious way.
(This also refers to Fibonacci levels.)
1st MONTH – Time frame
SUMMARY
The trend channel shown in the chart, in turquoise, formed since 2012 and has since maintained its position as a legitimate trend channel. Its mid-trend line showed reactions when confronted and was respected by the market.
> The price is in the area below the mid-trend line and did not have enough momentum to recapture it when it broke through.
The sideways trend channel shown in the chart, in purple, formed since 1987 and represented strong resistance and support areas on the higher time units.
> The price is above the channel and could encounter it for the first time at 124 USD.
> Should the price touch the level, I expect a strong reaction, in the opposite direction.
The trend lines drawn in the chart, in gold, formed in 1990 + 1995 and turned out to be very strong resistance or support areas.
> The price bounced twice in the recent upward movement and is meanwhile moving towards the lower trendline.
> In addition, we have the blue resistance line, which has been intact since the 80s, but is very unlikely to come into play for the time being.
If we go into more detail about the "SUPPLY & DEMAND" zones, you can look at three "DEMAND" + "SUPPLY" zones on the chart.
> The "DEMAND" zone 1, is VERY WEAK = followed a weak movement + previous month tested.
> The "DEMAND" zone 2, is VERY STRONG = followed a strong movement + has not been tested by the price so far.
> The "SUPPLY" zone 1, is VERY STRONG = followed by a Strong sell-off.
The Fibonacci retracements should serve us as additional confirmation, and have been taken into account in past movements (last decades).
> FIB 1 | will serve as resistance should the price attempt another sell-off run.
> FIB 2 | are the support areas, for a very strong sell-off.
> FIB 3 | are the possible targets, which would be possible in a very strong sell-off.
> FIB 3 | are the final upside targets, which would come into play in case of a bounce.
The past highs and lows usually serve as resistance/support, one of which we have.
> HIGHER HIGH | 1990
> OLD BROKEN HIGH | 1998
> [B]OLD HIGHER HIGH | 2015
Some levels of interest are before us, which in the last years + decades, played a strong role for the market.
> The currently most relevant - POI (126 USD) - represents an important mark already since the year 1988 and thus currently occupies a very strong support position.
> The future most relevant - POI (135 USD) - represents, like the current POI, an important mark since the year 1987 and will thus occupy a very strong resistance position.
> The other POIs are by no means negligible and will play a role in the price development in the coming days, weeks and months. (Therefore, take your time and transfer the ones that are relevant for you into your chart).
OVERVIEW
CURRENT RELEVANT
CHARTS
Overall picture without POIs + without FIBONACCI
Overall picture without POIs
Overall picture without FIBONACCI
ATTENTION
In the following time levels, I will only deal with the NEW, added elements..
2nd WEEK – Time frame
SUMMARY
Besides the already mentioned trend channel + trend lines, another trend channel becomes visible.
> This led the previous upward movement and already served as a support zone against the sell-off.
The monthly "SUPPLY & DEMAND" zones are joined by others from the weekly view that coincide with other resistance / support elements.
> The "DEMAND" zone 1, is VERY WEAK = followed a Weak move + previous week already tested.
> The "DEMAND" zone 2, is VERY STRONG = followed a Strong movement + has not been tested by the price so far.
> The "SUPPLY" zone 1, is VERY STRONG = followed a strong sell-off.
Smaller time units highs and lows join, the previously named.
> OLD HIGHER LOW | 05/2022
> OLD BROKEN HIGHER LOW [08/2022
CHARTS
Overall picture
Overall picture without FIBONACCI
THIRD PART
CONCLUSION
"Nothing is more expensive than what you get for free."
This Japanese proverb caught my eye and reminded me of all the lessons learned, which unexpectedly entered my life.
> They materialized through people, animals or other encounters, and to this day they represent the greatest value in my life.
> I refer to it, because everyone in this fast-moving time, usually overlooks / does not consciously perceive the most important moments and lessons.
In summary, based on technical analysis, there are reasons for a rising "USD / JPY" rate.
> Since the price top in October|2022 - the monthly candles were dominated by bearish.
> That this pattern is broken is possible, but as noted in the introduction, there are outstanding "key areas", which advocate a further sell-off.
> The divergence in the daily MACD, suggests a bullish move.
> The USD could get a strong impulse, which would allow a bullish move in this pair.
For this reason, I assume a strong "USD/JPY" rate + a weak JPY and an accompanying bloodbath in the traditional and crypto markets.
> Positioning after confirmation of this thesis = LONG.
If this idea and explanation has added value to you, I would be very happy to receive an evaluation of the idea.
Thank you and happy trading!
ZIEL IST DIE AUTARKIE | THE GOAL IS SELF-SUFFICIENCY
> The technical analysis and selected indicators, confirm the thesis of an imminent correction.
= Why, that I explain after the introduction.
The DXY / USD has a non-negligible impact on USD / JPY, as the whole economy depends on its behavior.
> Meanwhile, this seems to take run-up, for a final upswing, which could bring the precious metal under massive selling pressure.
> Regardless of these selling pressures coming from the USD, SILVER has been somewhat caught at a very strong resistance, which foreshadows a falling price.
In the following, the analysis goes into detail, so that the significant levels and areas are known to you.
For this purpose, I have performed a "MULTI-TIME-FRAME" analysis, which refers to the higher time units (month & week) and thus makes the big picture visible.
Normally all time units below "1h" are called noise, but even a - 1h-4h - analysis is of no use to you, if the knowledge about the big and whole is missing.
> We traders know that no one can predict the future, and that is exactly why you have to be prepared for all initial situations.
> If the DXY should rise again, that means "BLOOD" for the traditional and crypto markets.
> This creates dangers, but also opportunities - it is important to look at the big picture.
> Which levels are RELEVANT, I have explained in detail in the following pages.
Table of contents
1st part = INTRODUCTION
2nd part = TECHNICAL ANALYSIS
= Monthly - Time frame
= Weekly - Time frame
3rd part = CONCLUSION
PART ONE
"INTRODUCTION"
After the "USD/JPY" formed a top at USD 152 in October|2022, a sharp sell-off has been unleashed thereafter.
> This sell-off extended until today and could have reached its end.
> By could, I mean that there is still room to correct here. The correction can potentially run to 124 USD, where we would encounter a sideways channel. This showed its effect since 1987 and would be a strong support.
> The Fibonacci tool confirms us the possible end of the correction, by successfully working through the "golden pocket" (0.618 + 0.65 FIB)
= In addition to the sideways channel just mentioned, we are at the center line, of another channel, which led the previous upward movement since the year 2021.
> The downward movement is in a downward channel on the smaller time units (daily >) since December|2022 and shows a strong divergence in the daily MACD, which indicates a temporary end of the correction.
> Once you look at the DXY (USD index) at the higher time levels, the further sell-off in the traditional markets becomes even more likely.
(My DXY analysis is linked below this post, for confirmation purposes).
SECOND PART
TECHNICAL ANALYSIS
For the analysis of the higher time levels, I proceed according to the onion-skin principle.
> MONTH - level > WEEK - level > DAY - level
These are divided into
> SUMMARY > CHARTS
The charts are presented in logarithmic scaling, as the given information can be visually presented in a more harmonious way.
(This also refers to Fibonacci levels.)
1st MONTH – Time frame
SUMMARY
The trend channel shown in the chart, in turquoise, formed since 2012 and has since maintained its position as a legitimate trend channel. Its mid-trend line showed reactions when confronted and was respected by the market.
> The price is in the area below the mid-trend line and did not have enough momentum to recapture it when it broke through.
The sideways trend channel shown in the chart, in purple, formed since 1987 and represented strong resistance and support areas on the higher time units.
> The price is above the channel and could encounter it for the first time at 124 USD.
> Should the price touch the level, I expect a strong reaction, in the opposite direction.
The trend lines drawn in the chart, in gold, formed in 1990 + 1995 and turned out to be very strong resistance or support areas.
> The price bounced twice in the recent upward movement and is meanwhile moving towards the lower trendline.
> In addition, we have the blue resistance line, which has been intact since the 80s, but is very unlikely to come into play for the time being.
If we go into more detail about the "SUPPLY & DEMAND" zones, you can look at three "DEMAND" + "SUPPLY" zones on the chart.
> The "DEMAND" zone 1, is VERY WEAK = followed a weak movement + previous month tested.
> The "DEMAND" zone 2, is VERY STRONG = followed a strong movement + has not been tested by the price so far.
> The "SUPPLY" zone 1, is VERY STRONG = followed by a Strong sell-off.
The Fibonacci retracements should serve us as additional confirmation, and have been taken into account in past movements (last decades).
> FIB 1 | will serve as resistance should the price attempt another sell-off run.
> FIB 2 | are the support areas, for a very strong sell-off.
> FIB 3 | are the possible targets, which would be possible in a very strong sell-off.
> FIB 3 | are the final upside targets, which would come into play in case of a bounce.
The past highs and lows usually serve as resistance/support, one of which we have.
> HIGHER HIGH | 1990
> OLD BROKEN HIGH | 1998
> [B]OLD HIGHER HIGH | 2015
Some levels of interest are before us, which in the last years + decades, played a strong role for the market.
> The currently most relevant - POI (126 USD) - represents an important mark already since the year 1988 and thus currently occupies a very strong support position.
> The future most relevant - POI (135 USD) - represents, like the current POI, an important mark since the year 1987 and will thus occupy a very strong resistance position.
> The other POIs are by no means negligible and will play a role in the price development in the coming days, weeks and months. (Therefore, take your time and transfer the ones that are relevant for you into your chart).
OVERVIEW
CURRENT RELEVANT
CHARTS
Overall picture without POIs + without FIBONACCI
Overall picture without POIs
Overall picture without FIBONACCI
ATTENTION
In the following time levels, I will only deal with the NEW, added elements..
2nd WEEK – Time frame
SUMMARY
Besides the already mentioned trend channel + trend lines, another trend channel becomes visible.
> This led the previous upward movement and already served as a support zone against the sell-off.
The monthly "SUPPLY & DEMAND" zones are joined by others from the weekly view that coincide with other resistance / support elements.
> The "DEMAND" zone 1, is VERY WEAK = followed a Weak move + previous week already tested.
> The "DEMAND" zone 2, is VERY STRONG = followed a Strong movement + has not been tested by the price so far.
> The "SUPPLY" zone 1, is VERY STRONG = followed a strong sell-off.
Smaller time units highs and lows join, the previously named.
> OLD HIGHER LOW | 05/2022
> OLD BROKEN HIGHER LOW [08/2022
CHARTS
Overall picture
Overall picture without FIBONACCI
THIRD PART
CONCLUSION
"Nothing is more expensive than what you get for free."
This Japanese proverb caught my eye and reminded me of all the lessons learned, which unexpectedly entered my life.
> They materialized through people, animals or other encounters, and to this day they represent the greatest value in my life.
> I refer to it, because everyone in this fast-moving time, usually overlooks / does not consciously perceive the most important moments and lessons.
In summary, based on technical analysis, there are reasons for a rising "USD / JPY" rate.
> Since the price top in October|2022 - the monthly candles were dominated by bearish.
> That this pattern is broken is possible, but as noted in the introduction, there are outstanding "key areas", which advocate a further sell-off.
> The divergence in the daily MACD, suggests a bullish move.
> The USD could get a strong impulse, which would allow a bullish move in this pair.
For this reason, I assume a strong "USD/JPY" rate + a weak JPY and an accompanying bloodbath in the traditional and crypto markets.
> Positioning after confirmation of this thesis = LONG.
If this idea and explanation has added value to you, I would be very happy to receive an evaluation of the idea.
Thank you and happy trading!
ZIEL IST DIE AUTARKIE | THE GOAL IS SELF-SUFFICIENCY
Note
As predicted in the analysis, the - USD / JPY - stepped on the gas and rose from the day of the analysis.This rise went to the highlighted 0.328 FIB level and broke through it powerfully, before turning into a healthy correction.
= 8.41% | LONG - PROFIT = 1,070 PIPS
- The following correction ran up to the 0.786 level FIB (of the move) and bounced off it. (= goes hand in hand with the LILA drawn upward channel).
- Looking from the weekly view, we can assume a confirmation of a next upward movement, but we cannot say this 100% yet.
- Should the move continue to work its way up and break the old high (138.00), we will certainly see the predicted target (0.618 FIB = 142.00).
However, the decision for further action will depend on the performance of the DXY.
Note
The price is on the way to the superior - GOLDEN POCKET - (0.618 + 0.65 Fibonacci).> The probability that it after working off this, the correction I predicted is relatively high.
> However, there is also the possibility that the MM still want to take more liquidity and therefore the last SUPPLY ZONE is targeted.
In this regard, when we arrive at the decision point, I will update the IDEA another time.
DAY VIEW
WEEKLY VIEW
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