USD/JPY Swings Continue As Bearish Pattern Forms
- USD/JPY Technical Strategy: Sidelines Preferred
- Bearish Engulfing pattern may find little follow-through
- Shooting Star forms in intraday trades
USD/JPY has failed to hold above the psychologically-significant 102.00 level, with the recent push lower prompting the emergence of a Bearish Engulfing pattern. The reversal signal indicates a potential shift in momentum to the downside, which could open up the 101.20 mark. However, given the recent price swings for the pair it seems neither buyers nor sellers hold a strong grip over the currency, which may suggest the push lower may find limited follow-through.
Daily Chart - Created Using FXCM Marketscope 2.0
An examination of intraday price action on the chart below highlights the hesitation from the bulls near 102.00. While the candle has yet to close, a Shooting Star appears to be forming, which would suggest the tide may be turning in the bears favor.
USD/JPY: Hammer Foreshadowed Recovery
Four Hour Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, DailyFX
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