Talking Points:
- USDJPY price contained on two timeframes
- Key levels: Support at 11717/11600/11500, Resistance at 11886/11950
- Daily chart: Topping pattern or repeating triangle theme?
In the past week, swings in USDJPY have become muted. Focusing on congestion in two timeframes – Hourly and Daily. On the hourly chart, price has become contained between support at 11717 and resistance at 11886; on the daily chart these levels are 11550/11600 and 11950, respectively. The daily resistance is in the form of a downward sloping trend-line, so keep in mind this level decreases with each daily close.
At this juncture it is unclear as to whether price action beginning in early December will result in a topping pattern (series of lower highs) or a bullish descending triangle. It will take a bit more time for a triangle to develop, but should this occur it will be a repeating theme going on since 2012.
USDJPY Daily/Hourly
---Written by Paul Robinson, DailyFX Research
To contact Paul, you can email him at instructor@dailyfx.com
