The last 20 hours on the market has been a roller-coaster ride. It all started yesterday with a hawkish FED increasing the appetite for an already over-bought American dollar. Then, we moved to another central bank – BoJ, which did nothing at first, in order to intervene on the market later. The Japanese yen strengthened rapidly, establishing on some pairs new, monthly lows. Later we had SNB and, as we write these words, we’re getting very close to a rate decision from the BoE. Days like this do not happen often!
What is the situation like on the USDJPY after such a huge influence from the fundamental side of the market? Well, USDJPY finally looks bearish. We have a false breakout (grey) from the ascending triangle pattern (orange and red lines). False breakouts usually promote moves in the opposite direction, so in this case – down.
We also have a breakout of the mid-term up trendline (blue) and overall a very nasty bearish candle. With all this, I’m expecting a move towards the horizontal support on the 139 and maybe even further – the long-term black up trendline. The current sentiment is bearish and will become a positive should the price come back above the orange resistance, but chances for that happening are now rather limited.
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