USD/JPY Forex Technical Analysis – February 22, 2019 Forecast

The Dollar/Yen is trading slightly higher on Friday on relatively low volume. Volatility remains well-below average for a sixth session. On Thursday, the Forex pair settled lower as the U.S. Dollar fell in response to weaker-than-expected U.S. economic data. Durable Goods, Core Durable Goods, the Philadelphia Fed Manufacturing Index, Flash Manufacturing PMI and Existing Home Sales, all came in below expectations, confirming the Fed’s concerns over economic headwinds.

At 03:39 GMT, the USD/JPY settled at 110.730, up 0.021 or +0.02%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top at 111.130 on February 14.

A trade through 111.130 will negate the closing price reversal top and signal a resumption of the uptrend.

The minor trend is also up. A trade through 110.255 will change the minor trend to down. This will confirm the shift in momentum to the downside.

The short-term range is 111.130 to 110.255. Its 50% level or pivot at 110.693 is controlling the short-term direction of the Forex pair.

The main range is 113.710 to 105.180. The USD/JPY is currently trading on the strong side of its retracement zone at 110.452 to 109.445. This zone is controlling the longer-term direction of the Dollar/Yen.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the USD/JPY on Friday is likely to be determined by trader reaction to the short-term pivot at 110.693.

Bullish Scenario

A sustained move over 110.693 will indicate the presence of buyers. The first target is this week’s high at 110.950. Overcoming this level could generate the upside momentum needed to challenge the closing price reversal top at 111.130.

Bearish Scenario

A sustained move under 110.693 will signal the presence of sellers. The first target is the main Fibonacci level at 110.452. Crossing to the weak side of this level will indicate the selling pressure is getting stronger with the minor bottom at 110.255 the next likely target.