USD/JPY Price Forecast January 16, 2018, Technical Analysis
The US dollar has drifted below the 111 level, and reached towards the 110.50 level below where we found a little bit of bullish pressure. The support I think extends down to the 110-level underneath, which is a large, round, psychologically significant number. It is the 61.8% Fibonacci retracement level from the longer-term, and therefore I would expect to see buyers attracted to not only that round number, but the Fibonacci trading signal as well. Because of this, if we break down below the 110 level, I think at that point the market is likely to breakdown rather significantly. In the meantime, I think there’s a lot of volatility that is just waiting to happen, so I like selling rallies in the short term, at least until we break above the 111.70 level.
Overall, I think that we will eventually find buyers underneath, but the 110 level needs to prove itself on a daily chart for me to consider going long. A breakdown below that level will more than likely send the signal much lower, to at least the 108 level. I would become aggressively short of this market at that point, but in the meantime, I think you’re going to see a lot of short-term back and forth trading going forward, and I think that given enough time we will probably see sellers return every time there is a short moved to the upside. I think that the market will continue to be very noisy.
USD/JPY Video 16.01.18
This article was originally posted on FX Empire