Trading Setups / Chart in Focus:
USDJPY
The USDJPY broke lower today from the support near 76.00 that has been holding it for weeks now, although it is worth noting price closed just above 76.00 at 76.10. Still there was an obvious push lower today and we could see a resumption of the downtrend if price closes below 76.00 next week. Note the minor fakey that broke up from the coiling inside bars just prior to today’s breakdown.
EURUSD
The EURUSD pin bar from 1.3850-1.3900 resistance has not followed through to the downside as we hoped. Instead, we are seeing a short-term positive bias now as we can see support near 1.3660 has held this week, note the bullish rejection tails off the 8 / 21 EMA dynamic support. Also, note the large false-break that occurred, seen in the chart below, afterwards the market re-claimed price above 1.3660 as mentioned before.
The bulls were resilient this week, bucking most peoples’ bias of a potential resumption of downward momentum from core horizontal resistance near 1.3850 – 1.3900. We can see that the GBPUSD has already broken up out of resistance and we could see the EURUSD break up out of 1.3900 – 1.3940 resistance next week if the positive momentum continues. Note the next major resistance to watch comes in around 1.4100 and we would consider selling from this resistance area if an obvious bearish price action signal forms there next week. Until then, we can look to buy from support on dips near value on bullish price action signals.
