USD/JPY Reverses From False Breakout
- The USDJPY rebounds from a false breakout
- Bullish breakouts begin over 118.66
- Bullish reversals begin under 118.49
(Created using Marketscope 2.0 Charts)
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The USD/JPY has rebounded this morning, after the pair failed an attempted bearish breakout below key values of support. Currently, price action is now trading near range resistance, which is found at the R3 Camarilla Pivot point at a price of 118.47. It should be noted, that if today’s bullish momentum continues through the US session open, breakouts for the USD/JPY begin over the R4 pivot point at a price of 118.66. In this scenario, traders may utilize a 1-X extension of today 37-pip range to place initial pricing targets near 119.03.
It should be noted that if prices return inside of today’s range, it might represent a return to range bound conditions. A move below 118.47 opens the USD/JPY to move back towards values of support. This includes today’s S3 pivot point, which is found at 118.09.
SSI (Speculative Sentiment Index) for the USDJPY is currently reading at +1.40. While this value is not extreme, it does hold a slightly bearish bias for the pair. Trend traders looking to trade the USD/JPY should continue to monitor SSI. If SSI continues higher, it would add validation to an emerging downtrend. Conversely, if SSI flattens out, back towards a reading of +1.00, it may signal further indecision for the pair.
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.