Short-term buying likely on USD/JPY, traders...
USD/JPY:
Global growth and trade fears returned to the forefront of the market Tuesday, with US President Trump threatening tariffs on European products. Demand for the safe-haven Japanese yen increased as a result of this, consequently hounding the USD/JPY below March’s opening level at 111.36 on the H4 timeframe into 111.
111, as is evident from the chart, is holding ground as we close out Tuesday’s session. Note a few points beneath here is April’s opening level at 110.94, closely followed by local support priced in at 110.66.
Structure on the weekly timeframe has the candles facing the March 4 high at 112.13, shadowed closely by the 2018 yearly opening level priced in at 112.65. To the downside, demand (green) at 108.50-109.89 is visible, sited a few points north of support coming in at 108.13.
In terms of where we stand on the daily timeframe, the March 4 high at 112.13 mentioned above on the weekly timeframe is also a discernible resistance on this scale, though the more prominent resistance falls in around 112.33, closely tailed by a long-standing trend line resistance (etched from the high 114.55). Downside, on the other hand, could possibly draw as far south as demand at 109.55-110.05.
Areas of consideration:
With little in terms of nearby structure on the higher timeframes, follow-through buying could take shape from 111 and shake hands with 111.36 today. 111, as you can probably see, is further bolstered on the back of an ABCD convergence (black arrows) at 111.04 and 38.2% Fibonacci support at 111.01.
Note the 38.2% resistance of legs A-D (considered the first take-profit target out of the ABCD formation) sits south of 111.36 at 111.30. For that reason, although a move north is high probability, it could be limited. Therefore, do ensure to prepare for this possibility and incorporate a reasonable risk/reward factor into your trading decision. Targeting a ratio of more than 1:1 to the first area of concern is recommended.
Today’s data points: US CPI m/m; US Core CPI m/m; FOMC Member Quarles Speaks; FOMC Meeting Minutes.
Global growth and trade fears returned to the forefront of the market Tuesday, with US President Trump threatening tariffs on European products. Demand for the safe-haven Japanese yen increased as a result of this, consequently hounding the USD/JPY below March’s opening level at 111.36 on the H4 timeframe into 111.
111, as is evident from the chart, is holding ground as we close out Tuesday’s session. Note a few points beneath here is April’s opening level at 110.94, closely followed by local support priced in at 110.66.
Structure on the weekly timeframe has the candles facing the March 4 high at 112.13, shadowed closely by the 2018 yearly opening level priced in at 112.65. To the downside, demand (green) at 108.50-109.89 is visible, sited a few points north of support coming in at 108.13.
In terms of where we stand on the daily timeframe, the March 4 high at 112.13 mentioned above on the weekly timeframe is also a discernible resistance on this scale, though the more prominent resistance falls in around 112.33, closely tailed by a long-standing trend line resistance (etched from the high 114.55). Downside, on the other hand, could possibly draw as far south as demand at 109.55-110.05.
Areas of consideration:
With little in terms of nearby structure on the higher timeframes, follow-through buying could take shape from 111 and shake hands with 111.36 today. 111, as you can probably see, is further bolstered on the back of an ABCD convergence (black arrows) at 111.04 and 38.2% Fibonacci support at 111.01.
Note the 38.2% resistance of legs A-D (considered the first take-profit target out of the ABCD formation) sits south of 111.36 at 111.30. For that reason, although a move north is high probability, it could be limited. Therefore, do ensure to prepare for this possibility and incorporate a reasonable risk/reward factor into your trading decision. Targeting a ratio of more than 1:1 to the first area of concern is recommended.
Today’s data points: US CPI m/m; US Core CPI m/m; FOMC Member Quarles Speaks; FOMC Meeting Minutes.
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