USD/JPY: technical analysis 06.01.20

Current trend

On the 4-hour chart, the instrument is correcting up from the lower line of the Bollinger Bands. The price went up above the resistance level of 108.008 and can grow further to the levels of 108.203-108.261. This channel will be a first strong resistance area which can prevent the instrument from the growing. However, the breakout of 108.203 will give a prospect of growth to the level of 108.398.

Alternative scenario

The downward rebound from the 108.203 and pullback below 108.008 could lead the price back to 107.813 support. This level seems a key level for the sellers. There is a high chance of an upward rebound, while its breakdown would allow the fall to continue to the area of 107.617-107.422.

Technical indicators

Technical indicators mostly keep a sell signal, but the upward correction is possible in the short term.

Bollinger Bands are pointed downwards.

MACD is slowly decreasing in the negative zone but still keeps a sell signal.

Stochastic has left the oversold area and is pointed upwards, reflecting the high possibility of upward movement formation.

Support and resistance

Support levels: 108.008, 107.813, 107.617, 107.422.
Resistance levels: 108.203, 108.398, 108.594.

Trading recommendations

Short positions can be opened below the level of 107.813 with the target at around 107.617 and stop-loss at 107.878.
Long positions can be opened above the level of 108.203 with the target at around 108.398 and stop-loss at 108.138.

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