The U.S. Dollar may have some more room to trade higher against most major currencies, but that doesn’t look like the case versus the Japanese Yen. All the JPY-pairs are failing to counter much of the recent decline, which suggests that continuation patterns will soon lead to lower prices. USDJPY, EURJPY, GBPJPY and others were looked at in today’s session.
Technical Highlights:
- US Dollar Index (DXY) has a bit more room to go higher
- USDJPY bounce looks to be completed, renewed weakness anticipated
- EURJPY, GBPJPY and other Yen pairs posting bearish sequences
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US Dollar Index (DXY) has a bit more room to go higher
The US Dollar Index (DXY) has been moving steadily higher and at this time there is nothing to impede its progress until the index rises up towards the monthly high at 98.93 and top-side trend-line running over from last year. We may see yet another stop and reverse, so watching price action upon arrival of resistance will be important.
US Dollar Index (DXY) Daily Chart (room to go to resistance)
U.S. Dollar Currency Index (DXY) by Tradingview
USDJPY bounce looks to be completed, renewed weakness anticipated
USDJPY bounce recently ran into the June low and has been unable to climb above. The trend is generally weak and price action isn’t particular inspiring since the sharp decline earlier this month. This has USDJPY poised to trade lower towards the 2018/19 lows, 10463.
USDJPY Daily Chart (poised to trade lower)
EURJPY, GBPJPY and other Yen pairs posting bearish sequences
EURJPY is poorly postured as it sits just off the monthly low. On the 4-hr chart the weakening bounces and flat bottom are creating a descending wedge pattern. The path of least resistance is lower and a clean break of 11751 should have EURJPY rolling downhill even further soon.
EURJPY 4-hr Chart (descending wedge)
GBPJPY has been building yet another bear-flag on the 4-hr chart, the 4-th such pattern since the beginning of June. This has the cross positioned for another swing lower in the days ahead. The next target on a drop below 12654 is the October 2016 low at 12478.
GBPJPY 4-hr Chart (descending wedge)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
