USD/JPY: 108.000 Still On The Cards
Good afternoon Traders and welcome back to EverythingFX.
The US Dollar currently trading at 110.553 against the Japanese Yen during the New York Session.
Following up from the previous article I mentioned we required a break our support at 110.000 where we could see a new leg to the downside however we have bounced off of support fairly well.
Starting on the weekly timeframe we can see price had a massive sell-off last week straight in support. On the daily timeframe, price has formed a fairly bullish rejection where we could see price pulling back higher before heading lower once again.
Dropping down to a 4-hour timeframe we can see price previously found support at 110.900 where we have now broken through which then turns into resistance. I do expect us to come and tap this new found minor resistance before heading lower. My overall downside target for the pair is 108.000 which is a good 250 PIP trade from the current price. As illustrated on the chart above we could potentially fall from current price action or worst case scenario we get a third rejection of our descending trendline. What would invalidate my short bias is a break of our descending trendline at 111.250 which lead towards our next weekly resistance of 112.000.
Fundamentally we had US GDP data coming out at 2.2% which came in lower than predicted at 2.4% -this will affect the pair going forward. Stay tuned to our Market News Section as well as our Twitter feed for Live Market news and comments.