Weekly Technical Outlook: USD/JPY; Market Forecasts for May 23rd – May 27th
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Technical Analysis
Daily bias in USD/JPY remains bearish with 110.9611 resistances intact. A deeper decline is expected for the pair as long as resistance holds the area and the price action stays below resistances. At the end of the week, such a decline is viewed as a correction. Thus, we’d expect resistance to hold the area and pair remains bearish with break of 110.338 indicating a near term bearish reversal to take place, and turning the outlook to continue with the downside bias.
The price action signals a pin bar reversal bearish movement rejection at resistance area, thus closing below the break of trend line. Stochastic oscillator on the other hand is currently at 80.0 levels and pair closed below the rejection of trend line there is clear indication of trend reversal shifting the momentum. Current development suggests that the medium term downside is expected for a further low and focus shall be at 108.646. A break here should make lower lows at 107.489 levels. Outlook remains bearish for the week.
Economic
- FOMC Member Williams speech, FOMC Member Harker Speech
- New Home Sales, Goods Trade Balance, Durable Goods Orders, Initial Jobless Claims
- FOMC Member Powell Speech, Reuters/Michigan Consumer Sentiment Index
- Leading Economic Index, Coincident Index, Foreign investment in Japan stocks
- National CPI Ex-Fresh Food, National Consumer Price Index
Area of Interest
- Strong resistance at 110.9611 area and closed below resistance levels.
- Bearish pin bar reversal strongly closing below the trend line.
- Price action closed below trend line and oscillator below 80.0 levels indicating shift in momentum.
- At Flip Area on Daily time frame resistance levels.
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