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Current trend

USD/JPY has tested the support level of 108.580 and was slightly corrected upwards, but the downward trend maintains. The downward trend will be restored after the price is set below the level of this level. In this case, the next targets of sellers will be the level of 108.398.
Alternative scenario.
The rebound from the level of 108.596 and the pair’s consolidation above the level 108.789 can be a signal for upward movement formation. Further close above this level may push USDCAD even higher towards the area of 108.984-109.082. This area seems a strong resistance area that can activate a downward reverse. Meanwhile, a decisive break of 109.082 could trigger a pair’s fresh run-up to a 3-month high surrounding 109.281.
Technical indicators reflect the maintenance of the current downward trend. Bollinger Bands are diverging on the background of bearish momentum. MACD histogram is ready to enter the negative zone and form a sell signal. Stochastic’s lines are pointed downwards and are reaching the oversold area.

Support and resistance

Support levels: 108.594, 108.398, 108.203.
Resistance levels: 108.789, 108.984, 109.082.

Trading recommendations
Long positions can be opened above the level of 108.789 with the target at around 108.984-109.082 and stop-loss 108.688.
Short positions can be opened below the level of 108.594 with the target at around 108.398-208.203 and stop-loss 108.724.

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