Technical Analysis – Quieter USDJPY but bulls still in the game
October 10, 2023 1:28 pm
USDJPY edges higher as market is focusing elsewhere
A sense of calm after last Tuesday’s tumultuous session
Momentum indicators sending mixed signals
USDJPY is in the green today as market participants have turned their focus on geopolitical developments. This relative calmness comes after last Tuesday’s turbulent session that was assumed to be the result of intervention from the Japanese authorities. With USDJPY remaining a tad below the 150 level, the intervention threat remains at large.
In the meantime, the momentum indicators are portraying a mixed picture. The Average Directional Movement Index (ADX) is ready to signal a range-trading market, and the RSI continues to trade above its 50-midpoint. On the flip side, the stochastic oscillator has managed to break below its overbought territory, and it is tentatively edging lower. Should this move pick up pace, it would be seen as a strong bearish signal.
Should the bears decide to stage a pullback, they would try to push USDJPY below the August 11, 1998 high at 147.71, and then potentially test the support set by the busy 146.65-146.74 area. This range is defined by the 78.6% Fibonacci retracement of the October 21, 2023 – January 16, 2023 downtrend, the 50-day simple moving average (SMA) and the lower boundary of the upward trend channel, and it appears to be critical for short-term sentiment.
On the other hand, the bulls are trying to digest last week’s events and are potentially preparing to have another go at the October 3, 2023 high at 150.15. If successful in overcoming this level, they could have the chance to record a new 2023 high and then potentially set a course for the October 21, 2022 high at 151.94.
To sum up, market participants are in waiting mode as the market’s focus is elsewhere. However, USDJPY bulls do not appear ready to give up on recording new highs soon.
USDJPY edges higher as market is focusing elsewhere
A sense of calm after last Tuesday’s tumultuous session
Momentum indicators sending mixed signals
USDJPY is in the green today as market participants have turned their focus on geopolitical developments. This relative calmness comes after last Tuesday’s turbulent session that was assumed to be the result of intervention from the Japanese authorities. With USDJPY remaining a tad below the 150 level, the intervention threat remains at large.
In the meantime, the momentum indicators are portraying a mixed picture. The Average Directional Movement Index (ADX) is ready to signal a range-trading market, and the RSI continues to trade above its 50-midpoint. On the flip side, the stochastic oscillator has managed to break below its overbought territory, and it is tentatively edging lower. Should this move pick up pace, it would be seen as a strong bearish signal.
Should the bears decide to stage a pullback, they would try to push USDJPY below the August 11, 1998 high at 147.71, and then potentially test the support set by the busy 146.65-146.74 area. This range is defined by the 78.6% Fibonacci retracement of the October 21, 2023 – January 16, 2023 downtrend, the 50-day simple moving average (SMA) and the lower boundary of the upward trend channel, and it appears to be critical for short-term sentiment.
On the other hand, the bulls are trying to digest last week’s events and are potentially preparing to have another go at the October 3, 2023 high at 150.15. If successful in overcoming this level, they could have the chance to record a new 2023 high and then potentially set a course for the October 21, 2022 high at 151.94.
To sum up, market participants are in waiting mode as the market’s focus is elsewhere. However, USDJPY bulls do not appear ready to give up on recording new highs soon.
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