USD/JPY: Long term base already formed - Westpac

Sandeep Kanihama FXStreet Contributor

Tim Riddell, Research Analyst at Westpac, suggests that daily momentum shows signs of peaking as USD/JPY approaches 50% of its range of the past 18 months, however, indicators are not turning, yet.

Key Quotes

“USD gains off 104.55 may be completing a dynamic series of gains as it nears both 111.60 (50%) and declining resistance(112.15-25), but the trend could still extend. Dips ought to hold above 110.00 if the upside potential is to develop.”

“Weekly

Weekly momentum is approaching previous resistance, but remains very positive. This is indicative of a larger uptrend (even if an interim correction forms)
The style of gains from 104.55 are, as noted, decidedly dynamic. This is a sign of a strong uptrend which could retest and redefine 114.75-00 resistance”

“Monthly

Monthly momentum has now turned distinctly more positive over the past two months. If sustained, this would indicate a more USD positive profile through 2018
Although current focus may be a retesting/redefining of the 114.75-00 resistance area, potential is building for a more dynamic move into the low 120’s.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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