Weekly Technical Outlook: USD/JPY; Market Forecasts for October 9th – October 13th

• Resistance level 113.433
• Pivot Level 112.406
• Support Level 111.967, 111.451 and 111.133

Technical Analysis

Daily bias in USD/JPY remains bearish with 113.433 resistances intact. A deeper decline is still expected for the pair as long as resistances hold the area and price action stays below resistances so far at end of the week. And, such decline is viewed as a correction. Thus, we’d expect resistance to hold the area and the pair remains bearish with a break of 112.406 indicating that a near term bearish reversal has taken place. The pair is however holding above the levels and a confirm break below these levels are needed which shall suggest that bearish reversal has taken place.

Continuing this, the pair will turn its outlook to continue with the downside bias price action bearish movement.  The rejection at resistance area is closed below the trend line and stochastic oscillator is currently at 78.0 levels. The pair closing below the rejection of trend line indicates clearly the trend reversal shifting the momentum. Current development suggests that the medium term downside is expected further low and the focus shall be at 111.967 and breaking here should make lower lows of 111.451 / 111.133 levels. Overall, the outlook remains bearish for the week.

Economic

• FOMC Member Kashkari Speech, FOMC Member Kaplan Speech
• JOLTS Job Openings, FOMC Minutes, Initial Jobless Claims
• Retail Sales, Consumer Price Index for greenback
• Current Account, Tertiary Industry Index
• Foreign investment in Japan stocks, Consumer Price Index for yen

Area of Interest

• Strong resistance at 113.433 area and closed below resistance levels.
• Bearish momentum reversal strongly closing below the trend line with pin bar rejection.
• Price action closed below trend line and oscillator below 78.0 levels indicating shift in momentum.
• At Flip Area on Daily time frame resistance levels.

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