USD/JPY has massive support clusters and opt for the upside — Confluence Detector

Yohay Elam FXStreet

The Technical Confluences Indicator shows a massive concentration of support lines below the current price of the USD/JPY. This suggests another move to the upside as the path of least resistance. The initial convergence cluster is at ¥109.20. This is the meeting point of the Boling Band one-hour Middle, the SMA100-15m the SMA100-1h, SMA-5-4h, the Fibonacci 38.2% one-day, and the SMA10-4h.

It is closely followed around ¥10910 with the SMA-5 one-day, the Fibonacci 23.6% one-day, the Fibo 23.6 one-week, and the Bolinger Band one-hour Lower.

If that is not enough, the area around ¥108.80 is the confluence area of the on-month R2, the Fibonacci 38.2% one-week, and the Pivot Point one-month R2. The density of the Market Impact Tool speaks for itself.

A dense cluster of confluence awaits at ¥109.45 where the Bolinger Band 15m-Upper, the Pivot Point one-day R1, the Bolinger Band one-day Upper, the Bolinger Band 1h-Upper and several more lines meet. Further above, resistance lines are fewer and further between.

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. This means 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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