USD/JPY Forecast: Outlook constructive, eyes symmetrical triangle resistance
|Weekly chart
Observations-
- Symmetrical Triangle
- Bullish break from falling channel
- 50-MA bottomed out
- Larger falling trend line from Aug 2015 high and Dec 2015 high is still intact
Resistance: 111.71 - 111.84, 112.13 - 112.20, 112.60, 113.60
Support: 111.51-111.48, 111.07, 110.81, 110.61-110.52
Comments
Price action over the last three weeks - Doji followed by bullish outside week candle and a rise to 111.77 this week. This, coupled with a bullish break of the falling channel and the fact that 50-MA has bottomed out signals the spot is likely to extend the gains to 113.60 (symmetrical triangle resistance).
Daily chart
Bullish price-MACD divergence followed by a bullish crossover on the MACD and a break in the RSI above 50.00 signals the bulls remain in control.
However, the 100-DMA of 111.84 is still sloping downwards. A failure to hold above 111.58 (50% Fib R of 114.367-108.802) could yield a pullback to 111.07 (50-DMA), although the bigger picture remains bullish, hence the dips are likely to be met with fresh bids.
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