USD/JPY Price Analysis: The price has bounced of an old congestion area at 105.80
|- USD/JPY has fallen 0.14% on Wednesday despite a nice move higher last week.
- There could be some sideways movement to come now as the price is stuck between two levels.
USD/JPY 4-hour chart
USD/JPY has moved back into the middle of a very congested area and met some offers. The pair is normally correlated to the risk environment and at the moment stocks are very mixed. This is due to the fact that there is an upcoming US election and the White House is struggling to put together a stimulus bill. This Friday, things could get pretty volatile as the market will get the latest non-farm payroll figures and the pair is likely to stay pretty static until then.
The chart shows how strong the black line at 105.80 is. This is the key area within the consolidation as the price reacted around the zone at least nine times on the chart alone. The level now in focus is the support level at 105.20 if this level is broken then there could be a more sustained move to the downside.
The indicators will now be back in their familiar mid-zones as the market had been in a sideways consolidation for some time before the move lower towards 104.00. If anything they are slightly bearish as the MACD histogram is red and the Relative Strength Index is moving towards 50 again. Overall, it seems we need another shake out and much will depend on the data towards the end of the week.
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Additional levels
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