USD/JPY downfall may accelerate with only one support left – Confluence Detector

Yohay Elam FXStreet

US President Donald Trump said that "China broke the deal", boosting safe-haven flows and pushing USD/JPY lower. What's next?

The Technical Confluences Indicator shows that dollar/yen enjoys support at 109.80 where we see the convergence of the Bollinger Band 4h-Lower, the Fibonacci 161.8% one-month, the Pivot Point one-day Support 1, and the BB 1h-Lower.

If the currency pair loses this line, the next support cluster is significantly lower, around 109.12 where the Pivot Point one-month S3 awaits.

Looking up, USD/JPY faces strong resistance at 110.09 which is the confluence of the Fibonacci 38.2% one-day, the Simple Moving Average 5-4h, the previous 4h-high, the Fibonacci 23.6% one-day, the SMA 10-1h, and the BB 15min-Upper.

The next cap is also quite considerable. Between 110.55 and 110.72 we see a minefield of lines including the PP 1w-S2, the PP 1d-R2, the Fibonacci 161.8% one-day, the PP 1m-S1, the SMA 5-1d, and more.

Here is how it looks on the tool:

Confluence Detector

The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.

Learn more about Technical Confluence

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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