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Whipsaw price action Thursday, but capped by modest resistance at 118.09 to highlight pivotal resistance now at 118.06/10 with the setback from 117.95.
This activity after the Wednesday break through numerous chart and retrace supports enhances the bigger topping theme and leaves negative pressure intact to aim still lower through mid-January.
Short-term Outlook - Downside Risks:
- We see a more negative tone with the bearish threat through 116.07 for the key 115.56/50/45 area.
- Surrender here would target the chart/ retrace area at 113.85/50.
- Break here then aims for the bull gap from the start of November 2014 at 112.56/48.
What Changes This? Above 118.86 eases bear risks; through 119.97 signals a neutral tone, only shifting positive above 120.83.
- We see a downside bias for 116.07/01; break here aims for the key 115.56/50/45 area, which we would look to hold at first.
- But above 117.25 targets 117.95 and 118.06/10, with risk up to 118.86, which we would look to cap.
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