USD/JPY - Reward For Perseverance

From the beginning of the week, the situation of currency bulls was not very favorable. Their lack of strength to continue the last week's march to the north in combination with the breakdown below an important support line awakened the imagination of the sellers and pushed the currency pair to a fresh December low earlier today. Are there any supports on the horizon that can save the buyers from further declines?

EUR/USD – Breakout and Its Potential Implications

(Click on image to enlarge)

On Monday, we wrote that although EUR/USD broke below the lower border of the blue consolidation and the lower line of the blue triangle, currency bulls managed to trigger a rebound (…)

Thanks to their determination, the exchange rate came back above both previously-broken supports, invalidating Friday’s breakdowns. This is a bullish development, which in combination with the current position of the daily indicators (the CCI and the Stochastic Oscillator generated buy signals) suggests further improvement in the following days – especially if currency bulls close today’s session above both blue lines.

How high can the pair go?

In our opinion, if we see a daily closure inside the triangle and the consolidation, the buyers will likely extend gains and test the upper borders of both formation in the very near future (currently at around 1.4002-1.1412).

From today’s point of view, we see that the situation developed in tune with the above assumption and EUR/USD increased sharply earlier today. Thanks to this increase, the exchange rate broke not only above the upper border of the blue consolidation but also above the upper line of the blue triangle and the orange resistance zone, which stopped the buyers several times in the previous weeks.

This is a bullish development, which suggests further improvement in the following days – especially when we factor in the buy signals generated by the indicators, which continue to support higher values of the exchange rate.

1 2 3 4
View single page >> |

Disclaimer: We encourage you to subscribe to our daily Oil Trading Alerts.

If you enjoyed ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.