USD/JPY Price Analysis: Establishes sequence of higher highs and higher lows

USD/JPY has reversed trend and is now rising in the short-term.
Although it completed an abc correction it failed to decline afterwards, instead breaking higher.

Joaquin Monfort FXStreet

USD/JPY has probably reversed its short-term downtrend and is now trending higher after establishing a new sequence of higher highs and higher lows. Given “the trend is your friend” this suggests a bullish bias exists over the short term.

USD/JPY 4-hour Chart

The change in trend comes about after the pair continued rising despite completing an abc correction between August 5-7. Normally the completion of the abc correction would have been a signal the pullback had ended and the dominant downtrend was about to resume. However, in the case of USD/JPY the pair failed to decline and instead traded sideways before breaking decisively higher on August 15.

The break above the top of wave c indicates the short-term trend is now probably bullish and therefore more likely than not to continue rising. The 100-period Simple Moving Average (blue) is currently capping gains but a close above it would probably confirm a continuation higher to a target at 150.90 (August 1 swing high), followed by 151.94 (July 25 swing low) and then perhaps 155.22 (July 30 swing high).

Author

Joaquin Monfort

FXStreet

Joaquin Monfort is a financial writer and analyst with over 10 years experience writing about financial markets and alt data. He holds a degree in Anthropology from London University and a Diploma in Technical analysis.

AUD/USD consolidates above 0.7200 after hot Chinese CPI data

AUD/USD is extending its consolidative price action above 0.7200 during the Asian session on Wednesday, uninspired by hot Chinese CPI and PPI data. Meanwhile, rising RBA rate-hike bets act as a tailwind for the Aussie amid Yen-inspired US Dollar weakness. Traders await the release of US inflation figures later in the week for fresh impetus.

USD/JPY stays weak near 153.50 amid aggressive BoJ hike bets

USD/JPY attracts fresh sellers in the Asian session on Wednesday as the strong Reuters Tankan business survey adds to the case for continued BoJ policy normalisation and boosts the Japanese Yen. This, along with a broadly weaker US Dollar, keeps the pair close to a nearly seven-month low set on Tuesday.

Gold recovers further from one-week low, retakes $4.400 amid sustained USD selling

Gold builds on its intraday recovery from a one-week low and reclaims the $4,400 mark heading into the European session on Wednesday. The commodity, for now, seems to have snapped a three-day losing streak amid a weaker US Dollar, which remains depressed near its lowest level in over two weeks amid the Bank of Japan-inspired rally in the Japanese Yen.

Bitcoin takes a breather, Ethereum and XRP maintain bullish footing

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) are trading with a broadly constructive tone on Wednesday despite BTC's mild pullback over the past two days. The Crypto King holds above $78,000; ETH and XRP remain strong above key Exponential Moving Averages (EMAs), keeping their upside prospects intact.

Oil, Apple and JPY in focus

Oil prices are rising on Wednesday as tit-for-tat strikes between Iran and the US threaten oil supplies as the two sides battle for control of the Strait of Hormuz. Stock futures have switched their attention from a strong earnings season to the challenges ahead, including a 10-year Treasury yield that is hovering close to the 4.8% level.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.