USD/JPY path of least resistance is up ahead of the Fed – Confluence Detector

USD/JPY has stabilized in the mid-111.00s as tension mounts ahead of the Fed decision. The technical levels clearly point to the upside for the pair.

The Technical Confluences Indicator shows a very dense cluster awaits dollar/yen around 111.50. It includes the Fibonacci 38.2% one-week, the Simple Moving Average 100-1h, the previous daily high, the Bollinger Band 15min-Middle, the SMA 200-1d, the BB 4h-Middle, the SMA 50-15m, the previous monthly high, the Fibonacci 61.8% one-day, the SMA 100-15m, the SMA 100-4h, the SMA 100-1h, the SMA 5-4h, the SMA 200-15m, and the Bollinger Band 1h-Middle.

If USD/JPY loses the line, it enjoys another considerable cushion at 110.92 where we note the convergence of the SMA 200-4h, the previous weekly low, the PP 1w-S3, and the Fibonacci 23.6% one-month.

Looking up, resistance is weaker. At 111.97, the confluence of the PP 1d-R3, and PP one-week R1 await the pair. 

Further up, 112.43 is a worthy upside target as this is another meeting point of two Pivot Points: the one-week R2 and the PP one-month R1.

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.

Learn more about Technical Confluence