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Christopher Lewis
USD/JPY daily chart, February 22, 2019

The US dollar has shown a lot of proclivity to go sideways in this area, as we are hanging about the 61.8% Fibonacci retracement level. That of course will attract a lot of attention by itself but keeping that in mind, we also have the 200 day EMA sitting just above. That’s an area that has been important from a longer-term standpoint for most traders, and it is now offering resistance. On the other hand, we also have the 50 day EMA underneath that is turning up, which is a bullish sign.

USD/JPY Video 22.02.19

Looking at this chart, I suspect that the cluster back in December in this area should continue to cause a lot of reaction, so therefore I’m not sure that this market makes a huge move anytime soon. However, if we can break out of the rectangle that I have drawn on the chart, it’s obvious that we could make a move. I suspect that there is probably more likelihood of a downward move than up, but at this point it doesn’t look like the market is ready to go anywhere soon. Ultimately, if we do break down below the ¥110 level, the market probably goes looking towards the 100 a ¥0.50 level in a continuation of the previous move.

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Just above, the ¥112 level is a major resistance barrier as well, so really at this point I think it’s very difficult to imagine that we can go to the upside for any longer-term move.

Please let us know what you think in the comments below

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