USD/JPY is down, but not out, with 110.05 providing significant support – Confluence Detector
USD/JPY dropped amid a worsening global mood: there are more signs of a slowdown and trade talks between the US and China are not going anywhere fast. The yen is in high demand, but dollar/yen may be limited in its falls.
The Technical Confluences Indicator shows that USD/JPY has some support at 110.25 where we see the convergence of the Bollinger Band 4h-Lower, the Simple Moving Average 200-1h, the SMA 50-4h, and the SMA 50-1d.
The most significant cushion awaits at around 110.06 where we see the Pivot Point one-day Support 2, the Fibonacci 23.6% one-week, and last month's high, a potent mix.
Looking up, the pair faces some resistance at 110.56 where we see the confluence of the Pivot Point one-week Resistance 2 and the previous 4h high.
More importantly, 110.71 is a juncture including the SMA 100-15m, the BB 4h-Middle, and the Fibonacci 38.2% one-day.
All in all, the path of least resistance is to the upside.
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.
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.
