Market Analysis for USD/JPY
In today’s analysis of USD/JPY, we explore the current market structure and identify key levels that could offer trading opportunities. The recent upward momentum shows signs of exhaustion, hinting at a potential pullback. We will break down the 1-hour, 4-hour, and daily charts to highlight possible areas of interest for both buyers and sellers.
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The 1-hour chart shows USD/JPY moving within a clear rising channel. The price has recently formed a bearish rejection near the top of the channel, which is a possible signal of weakness.
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- Key Observations:
- Price has reached the upper boundary of the ascending channel, indicating resistance.
- The bearish candles that follow suggest sellers might be stepping in to push the price lower.
- A pullback towards the mid-channel or the lower boundary of the channel at 144.995 is expected.
2. 4-Hour Chart Analysis
In the 4-hour timeframe, we see a well-formed rising wedge, typically a bearish reversal pattern. However, a strong rejection from the 147.000 area has led to a minor pullback.
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- Key Observations:
- The buying area is identified around 145.004 where the price may find support.
- A break below 145.000 could signal a deeper correction, whereas a bounce from this level could present a buying opportunity.
3. Daily Chart Analysis
On the daily chart, the broader structure shows a large descending wedge, which USD/JPY has recently broken out of. This breakout led to a move higher, and now we are observing the market potentially retesting previous liquidity zones.
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Key Observations:
- The price is testing the liquidity area highlighted on the chart, which previously served as resistance.
- If the price manages to stay above 145.225, there is room for it to continue towards the wick-fill area around 149.344.
- There is a higher time-frame target at 149.344 which could be the next point of interest if the bullish momentum sustains.
Strategy: Traders could watch for pullbacks toward the 145.225 - 145.004 area for buying opportunities. A sustained move above 146.500 could trigger further bullish momentum towards 149.344.
| Conclusion: USD/JPY is showing signs of a potential pullback after a sharp upward move. Traders should monitor key support zones at 145.004 and 145.225 for bullish setups, while keeping an eye on 149.344 as a higher target. Keep an eye on bearish developments in the short term but look for buying opportunities as the market pulls back into these key levels. |
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