Forecast on Forex Majors USDJPY
Bias: Look for 120.10 to cap with range trading above 117.59 and a possible expansion to 116.63
Daily Bullish: Today looks as if we have seen a cap at 119.36 and this should cause a move back to 118.27-32. Thus only directly above 119.36 would pressure the 119.67 and 120.10 resistance levels directly. Next resistance at 120.53.
MT Bullish: The break above 119.15 yesterday means we have met the intermediate low at 117.59 and thus we should now see a period of correction that could extend sideways for a while. 120.10 should provide the peak (max 120.53). It is likely to be a 1-2 week consolidation and we should be prepared for messy moves between 117.59 and 120.10. If there is any earlier dip to 116.63 this may just be a complex correction with a return back to 120.10. Thus only above 120.60-73 would trigger a move back above 122.00.
Daily Bearish: I think we have selling opportunities today with 119.36 looking to be a short term peak. This should lead to losses down to 118.60 and then probably 118.27-32 which should hold. Only below retests 117.59.
MT Bearish: Cycles are still bearish for a further 2-4 weeks and thus while I dont feel we will see a break lower next week it must be remembered that this is the underlying direction. I suspect we should get a good selling opportunity at 120.10 and while the move may be choppy (watch the negative carry) we should see a move back to 118.20 at least while a retest of the 117.59 low is also possible and would then retest the 120.10 area again. Any break down to 116.63 would be a complex & cause a move up to 120.10 again.
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