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USD/JPY: technical analysis 15.10.2019

Current trend

USD/JPY pair continues to consolidate in the side channel with the borders 108.445-108.277. Meanwhile, the pair has the potential to further downside to the support level of 108.203. The breakdown of this level will be a signal for downward movement development and let the price to fall to the area of 108.027. There is a chance of an upward rebound, while its breakdown would allow the fall to continue to the 107.813 mark, which seem a key for the sellers.
Alternative scenario. If USD/JPY cannot consolidate below the level of 108.203 during short term period, the upward movement restoration and retest of the resistance level 108.594 are possible. One may speak about upward trend continuation after the price consolidates above this level. In this case, the next targets of buyers will be the area of level of 108.984. Now the technical indicators reflect the low trading activity and moderate developing of the current downward movement. Bollinger Bands are converging on the background of bearish momentum. MACD volumes are decreasing in the positive zone. Stochastic has left the overbought area and is pointed downwards, reflecting the high possibility of the downward movement formation.

Support and resistance

Support levels: 108.203, 108.027, 107.813.
Resistance levels: 108.594, 108.984, 109.375.

Trading recommendations

Short positions can be opened below the level of 108.203 with the target at around 108.027-107.813 and stop-loss 108.336.
Long positions can be opened above the level of 108.594 with the target at around 108.984 and stop-loss 108.464.

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