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Price & Time: USD/JPY Flirting With Danger

By , Sr. Currency Strategist
10 April 2014 12:00 GMT

Talking Points

  • USD/JPY tests key downside pivot
  • EUR/USD overcomes important resistance barrier
  • Gold closing in on big retracement

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Foreign Exchange Price & Time at a Glance:

Price & Time Analysis: EUR/USD

PT_APR_10_body_Picture_3.png, Price & Time: USD/JPY Flirting With Danger

Charts Created using Marketscope – Prepared by Kristian Kerr

  • EUR/USD overcame last week’s 1.3820 high yesterday
  • Our near-term trend bias is now positive on the Euro
  • The 78.6% retracement of March/April range at 1.3900 is the next key upside pivot
  • A minor cycle turn window is eyed on Friday
  • A move under 1.3745 is needed to re-focus lower

EUR/USD Strategy: Square for now, looking to buy on weakness in the days ahead.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

EUR/USD

*1.3745

1.3820

1.3865

*1.3900

1.3940

Price & Time Analysis: GOLD

PT_APR_10_body_Picture_2.png, Price & Time: USD/JPY Flirting With Danger

Charts Created using Marketscope – Prepared by Kristian Kerr

  • XAU/USD has moved steadily higher since finding support last week just under the 50% retracement of the December/March advance at 1285
  • Our near-term trend bias is lower in the metal while below 1335
  • Interim support is seen around 1300, but weakness under 1285 is required to signal a resumption of the medium-term downtrend
  • This week is an important cycle turn window
  • A daily close over 1335 will turn us positive on Gold

XAU/USD Strategy: Reduced short positions favored while below 1335.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

XAU/USD

*1285

1300

1322

*1335

1349

Focus Chart of the Day: USD/JPY

PT_APR_10_body_Picture_1.png, Price & Time: USD/JPY Flirting With Danger

USD/JPY has come under steady pressure since failing at the top end of a rising trend channel near 104.00 last week. The exchange rate is now closing in on key support at 101.35, which is the 4th square root relationship of the year’s high. This level has proven to be formidable over the past couple of months as the exchange rate has only settled below it once since early February. Our big concern is that the failure around the start of the year at the long-term Fibonacci confluence in the 105.50 area was just the start of a more important and complex corrective process. Weakness below 101.35 and 100.75 in the days would be a very strong sign that a new leg lower of this process is unfolding. A minor cycle turn window is seen today, but the next truly important cyclical period looks to be the second half of NEXT week. A high during this time would be a very negative development. Only strength back over 103.35 relieves the immediate downside pressure.

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--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.

To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX

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10 April 2014 12:00 GMT