Interesting P.A seen in this market...
Weekly gain/loss: + 256 pips
Weekly closing price: 111.51
Having seen the USD/JPY gap over 150 pips north after a win by centrist Emmanuel Macron at the French presidential elections last week, we saw the unit enter into the jaws of a weekly supply coming in at 112.19-111.05. The gap, as can be seen from the weekly chart, has yet to be filled and the buyers and sellers remain battling for position within the confines of the said supply.
Since Wednesday, daily price has been seen teasing the underside of a resistance area carved from 111.35-112.37. Judging by the candle action here the bulls still have the upper hand, but given the surrounding weekly supply this could very well change sometime this week! In the event that the bears do come into the market here, the next area of interest for us would be the support zone seen at 107.15-107.90, which is joined closely by a 61.8% Fib support at 107.84 taken from the low 101.19. A continuation move to the upside, nevertheless, could set the stage for price to challenge the resistance area at 115.62-114.60.
A brief look at recent dealings on the H4 chart shows that the market is currently engaged within the walls of a range fixed between 111.70/111.04. Also of interest here is April’s opening level at 111.41 seen housed within. A few pips above this consolidation is supply marked at 112.19-111.95, which surrounds the 112 handle and is located within the upper limits of both the current weekly supply and daily resistance area. Below the range is mid-level support at 110.50 that ties in nicely with a 61.8% Fib support at 110.41 taken from the low 109.59.
Our suggestions: In respect to current price action, here’s what we see:
• Taking a long on the break of said H4 range is not permitted owing to higher-timeframe structures and the aforementioned H4 supply.
• A break below the H4 range followed up with a strong retest is, in our opinion, worthy of consideration since there’s room for a move down to at least 110.50 from here, and possibly further.
• Entering into longs from 110.50 may be chancy what with price lodged within both weekly and daily resistances!
Data points to consider: Treasury Sec Mnuchin speaks at 12.45pm. US Core PCE index release at 1.30 and US ISM manufacturing PMI figures at 3pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: Watch for price to engulf 111.04 and then look to trade any retest seen thereafter (waiting for a H4 full-bodied bear candle to form following the retest is advised, stop loss: ideally beyond the candle’s wick).
Weekly closing price: 111.51
Having seen the USD/JPY gap over 150 pips north after a win by centrist Emmanuel Macron at the French presidential elections last week, we saw the unit enter into the jaws of a weekly supply coming in at 112.19-111.05. The gap, as can be seen from the weekly chart, has yet to be filled and the buyers and sellers remain battling for position within the confines of the said supply.
Since Wednesday, daily price has been seen teasing the underside of a resistance area carved from 111.35-112.37. Judging by the candle action here the bulls still have the upper hand, but given the surrounding weekly supply this could very well change sometime this week! In the event that the bears do come into the market here, the next area of interest for us would be the support zone seen at 107.15-107.90, which is joined closely by a 61.8% Fib support at 107.84 taken from the low 101.19. A continuation move to the upside, nevertheless, could set the stage for price to challenge the resistance area at 115.62-114.60.
A brief look at recent dealings on the H4 chart shows that the market is currently engaged within the walls of a range fixed between 111.70/111.04. Also of interest here is April’s opening level at 111.41 seen housed within. A few pips above this consolidation is supply marked at 112.19-111.95, which surrounds the 112 handle and is located within the upper limits of both the current weekly supply and daily resistance area. Below the range is mid-level support at 110.50 that ties in nicely with a 61.8% Fib support at 110.41 taken from the low 109.59.
Our suggestions: In respect to current price action, here’s what we see:
• Taking a long on the break of said H4 range is not permitted owing to higher-timeframe structures and the aforementioned H4 supply.
• A break below the H4 range followed up with a strong retest is, in our opinion, worthy of consideration since there’s room for a move down to at least 110.50 from here, and possibly further.
• Entering into longs from 110.50 may be chancy what with price lodged within both weekly and daily resistances!
Data points to consider: Treasury Sec Mnuchin speaks at 12.45pm. US Core PCE index release at 1.30 and US ISM manufacturing PMI figures at 3pm GMT+1.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: Watch for price to engulf 111.04 and then look to trade any retest seen thereafter (waiting for a H4 full-bodied bear candle to form following the retest is advised, stop loss: ideally beyond the candle’s wick).
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