During the course of yesterday’s sessions the USD/JPY aggressively whipsawed through the 115 handle, tapped the underside of a nearby H4 supply zone at 115.37-115.18, and proceeded to selloff going into the London segment. With the H4 candles now currently finding support just ahead of the H4 mid-way number 114.50, where do we go from here? Well, according to the weekly timeframe, price remains on course to cross swords with a weekly resistance level seen at 116.08. Despite this, the daily candles are persistently holding ground within the walls of a daily resistance area coming in at 115.62-114.60.
Our suggestions: Based on the above notes, our team has their eye on the H4 113.84/114.20 (AB=CD H4 Fib ext. 127.2/161.8%) neighborhood for longs. Granted this does entail entering long just below the current daily resistance area, but what with weekly price suggesting further buying could be on the cards and the confluence (H4 trendline support extended from the high 115.62, 114 handle and H4 AB=CD approach ) seen around 113.84/114.20, a bounce north from here is considered high probability, in our opinion. Be that as it may, we would not advise trading this zone around FOMC time today, as volatility is expected to be high.
Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.
Levels to watch/live orders:
• Buys: 113.84/114.20 (waiting for a lower-timeframe confirming signal to form is advised – this will help avoid a fakeout down to the nearby H4 demand at 113.47-113.70, stop loss: dependent on where one confirms this level).
• Sells: Flat (stop loss: N/A).
Our suggestions: Based on the above notes, our team has their eye on the H4 113.84/114.20 (AB=CD H4 Fib ext. 127.2/161.8%) neighborhood for longs. Granted this does entail entering long just below the current daily resistance area, but what with weekly price suggesting further buying could be on the cards and the confluence (H4 trendline support extended from the high 115.62, 114 handle and H4 AB=CD approach ) seen around 113.84/114.20, a bounce north from here is considered high probability, in our opinion. Be that as it may, we would not advise trading this zone around FOMC time today, as volatility is expected to be high.
Data points to consider: US CPI report/US retail sales both scheduled for release at 12.30pm, FOMC rate decision, economic projections and press conference at 6-6.30pm GMT.
Levels to watch/live orders:
• Buys: 113.84/114.20 (waiting for a lower-timeframe confirming signal to form is advised – this will help avoid a fakeout down to the nearby H4 demand at 113.47-113.70, stop loss: dependent on where one confirms this level).
• Sells: Flat (stop loss: N/A).
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