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Trade view / 28 September 2016 at 7:54 GMT

Lower highs to cap buying in USDJPY

Analyst / PIA First
United Kingdom
Background

USD Index: The chart highlights the index in a bullish ascending triangle formation with the same smaller formation inside (green). They teach you at the Society of Technical Analysts that to be a true trendline, the market needs to touch three times. 

Through experience, I can say that we normally break through on the fourth (especially in wedge formations). This would mean that there is scope for a correction lower from yesterday’s high but losses should be limited. Still buying USD dips. 

USD Index
Source: Saxo Bank 

One major pair that looks likely to play opposite to this USD bias is USDJPY.

Monthly: Highlights three inside months, a clear sign of investor indecision. We are between the 50% and 61.8% pullback levels at 100.57-94.61. Trendline support (channel base) is at 97.60.

USDJPY M
Source: Saxo Bank 

Weekly: Highlights a bearish five-wave count completed. However, we have no clear indication of a change of trend and could easily see a fifth wave extension (Elliott Wave). Next solid support is located at 93.77. 

Maybe we will form some sort of ending wedge but it is far too early to tell. 

USDJPY W
Source: Saxo Bank 

Daily: Shows the pair in a channel formation. Trendline support is close to 100.00.

Four-hour: Shows an AB=CD formation complete. However, there is little in the way to show that the trend is changing to the upside. 

USDJPY 4
 Source: Saxo Bank

One-hour: The most important timeframe to this outlook is the one-hour chart. Here, we are in a descending triangle formation with the trend of lower highs lining up closely to our bespoke resistance level. This will be our intraday trigger. 

USDJPY 1

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Source: Saxo Bank

Management and risk description

Parameters

Entry: selling at 100.80.

Stop: 101.20.

Target: intraday 100.10. Medium-term possibly 95.00.

— Edited by Michael McKenna

For more on forex click here.

Non-independent investment research disclaimer applies. Read more
28 September
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
Moving lower now. If we break 100.59 then we can look to lower stop
28 September
Bullionaire Bullionaire
Ok
28 September
Blange Blange
Ian, I suppose this will happen before US market opens and the trend will be aplifyed while open
28 September
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
hopefully during Durable Goods
28 September
vyacheslav111 vyacheslav111
Your opinion now ?
28 September
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
I am still a bear but got to hold the top
28 September
vyacheslav111 vyacheslav111
Thanks!!!
29 September
vyacheslav111 vyacheslav111
Hi ! Your opinion on USDJPY now ? ))
29 September
Ian Coleman - First 4 Trading Ian Coleman - First 4 Trading
got stopped flat ... no resistance until 102.45
29 September
vyacheslav111 vyacheslav111
Thanks!

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