USD/JPY 4H chart 7/18/2013 8:45AM EDT
Consolidation: The USD/JPY has been in consolidation since hitting a high early July, at 101.52. The market retreated almost to the 98.00 handle before finding support. This consolidation has been held below a falling trendline that goes back to the 101.52 high. However price action going into the 7/18 US session appears to have broken this line, exposing the 101.52 high.
RSI, SMA: The RSI shows some initial bearish momentum as the reading fell below 30. This bearish momentum is being challenged now as the the reading tries to break above 60. If it can hold below 60, or come right back below 60 after a brief violation, the bearish momentum can be considered maintained.
The 200-4H SMA is flat, reflecting a sideways market in this time-frame. Price is above this 200SMA so there is a slight bullish bias. The other MAs are all converged, reflecting the consolidation so far in July.
Upside: Because of non-trending conditions, we can anticipate some resistance around 101.50, but only for the very short-term. If you look at the daily chart, we can see that there is still some further upside toward the 2013-high around 103.73, especially because the bullish mode in the daily chart is still strong, though it has flattened relative to the pace before April, back to Oct. 2012.
USD/JPY daily chart 7/18/2013 8:50AM ET
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