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USDJPY Presses Resistance Ahead of BoJ- Support at 108.87

USDJPY Presses Resistance Ahead of BoJ- Support at 108.87

2014-10-30 20:52:00
Michael Boutros, Strategist
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Talking Points

USD/JPY Daily Chart

USDJPY Presses Resistance Ahead of BoJ- Support at 108.87

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • USDJPY approaching yearly highs / key resistance ahead of BoJ / November open
  • Resistance at 109.52/59- Breach targets resistance objectives at 110.08 & 110.50
  • Support at October trendline, 107.63, 106.24 & 105.88
  • Key support / broader bullish invalidation 105.44/57
  • Daily RSI reversal ahead of 40 / 60-breach – constructive
  • Multiple momentum resistance triggers pending- look for reaction
  • Event Risk Ahead: Japanese Jobless Rate, CPI & Bank of Japan Rate Decision tonight and US Personal Income/Spending & University of Michigan Confidence tomorrow

USD/JPY 30min Chart

USDJPY Presses Resistance Ahead of BoJ- Support at 108.87

Notes: The USDJPY is trading within the confines of a well-defined Andrew’s Pitchfork formation off the October lows with a clear break of the weekly opening range yesterday (post-FOMC) shifting the focus to the topside. The rally has now taken the pair into key resistance just shy of the 2014 highs. Long exposure is at risk heading into 109.52/59 with a breach (on a close basis) needed to maintain our topside scalp bias.

Bottom line: Look for short triggers ahead of 109.60 with a move sub-108.87 / pitchfork support offering further conviction for our near-term scalp bias. A breach above 109.60 invalidates the short-bias with such a scenario eyeing the 2014 high at 110.08 and beyond. Caution is warranted heading into key event risk with the Japanese jobless claims, inflation and the Bank of Japan interest rate decision on tap this evening. Follow the progress of trade setups like these and more throughout the trading week with DailyFX on Demand.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

Entry/Exit Targets

Timeframe

Level

Technical Relevance

Resistance Target 1

Daily / 30min

109.52/59

88.6% Retracement / October Open

Resistance Target 2

Daily / 30min

~109.80

~Pitchfork Resistance

Bearish Invalidation

Daily / 30min

110.08

2014 High

Break Target 1

Daily

110.50

August 2008 High Day Close

Break Target 2

30min

111.00/17

Big Figure / 2.618 Ext

Support Target 1

Daily / 30min

108.87

2014 High Day Close

Bullish Invalidation

30min

108.36

Weekly ORH / Pitchfork Support

Break Target 1

30min

108.00

Big Figure

Break Target 2

Daily / 30min

107.63

50% Retracement / Weekly ORL

Break Target 3

30min

107.38/40

61.8%v Ext / Sept & Oct Swing High(s)

Break Target 4

30min

107

Big Figure

Break Target 5

30min

106.66

Soft Support / Pivot

Break Target 6

Daily / 30min

106.23

10/21 Low

Break Target 7

30min

105.88

October Low Day Close

Break Target 8

Daily

105.45/57

50% & 61.8% Retrace(s) / Jan Highs

Average True Range

Daily (20)

94

Profit Targets 21-24pips

*ORH: Opening Range High

*ORL: Opening Range Low

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

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