USD/JPY Price Analysis: Looks south with bear flag breakdown on 4H chart


  • USD/JPY feels the pull of gravity as risk sentiment weakens on coronavirus concerns. 
  • Deeper losses look likely, as the 4-hour chart shows a bear flag breakdown.

The anti-risk Japanese yen is gaining ground on coronavirus-induced risk-off in stock markets and pushing USD/JPY lower. 

At press time, the currency pair is trading largely unchanged on the day near 104.45, having put in a high of 104.56 early today. Technical charts suggest scope for deeper declines.  

The pair fell by 0.4% on Tuesday, confirming a bear flag breakdown on the 4-hour chart. The pattern indicates a continuation of the sell-off from the Oct. 20 high of 105.75, possibly toward 104.00 (Sept. 21 low). A close above 105.00 is needed to invalidate the immediate bearish bias. 

That looks unlikely as the bear flag breakdown is backed by a below-50 or bearish reading on the relative strength index. The 4-hour chart MACD is also producing deeper bars below the zero line, a sign of the strengthening of the downward momentum. 

4-hour chart

Trend: Bearish

Technical levels

USD/JPY

Overview
Today last price 104.47
Today Daily Change 0.06
Today Daily Change % 0.06
Today daily open 104.41
 
Trends
Daily SMA20 105.33
Daily SMA50 105.57
Daily SMA100 106.13
Daily SMA200 107.2
 
Levels
Previous Daily High 104.89
Previous Daily Low 104.39
Previous Weekly High 105.75
Previous Weekly Low 104.34
Previous Monthly High 106.55
Previous Monthly Low 104
Daily Fibonacci 38.2% 104.58
Daily Fibonacci 61.8% 104.7
Daily Pivot Point S1 104.24
Daily Pivot Point S2 104.06
Daily Pivot Point S3 103.74
Daily Pivot Point R1 104.74
Daily Pivot Point R2 105.07
Daily Pivot Point R3 105.24

 

 

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