06, January 2017

USD/JPY (a 4-hour chart)

General overview

The US dollar keeps losing its value across the board amid growing uncertainty over the next Fed rate hike timing. Moreover, the Fed is uncertain about the upcoming Trump administration.

Current situation

The USD/JPY pair remained under intense selling pressure on Thursday. Sellers continued to dominate and dragged the pair lower in the Asian session. The downward move lacked momentum around 116.00. After posting a session low at 115.60 the US dollar staged an impressive recovery and erased all its early losses. The price returned to the opening prices where its recovery momentum stalled. Despite the ongoing recovery USD/JPY remained in bearish territory. The price broke the 50 and the 100-EMAs downwards in the 4 hours chart. The US dollar remained between the 100 and 200 EMAs the first part of the day. The 100 and the 200-EMAs kept pointing higher while the 50-EMA remained neutral. The resistance is highlighted at 117.00, the support comes in at 116.00.

MACD entered the negative area. If MACD remains in the negative territory, sellers’ positions will strengthen. The RSI was within oversold readings.

Trading recommendations

A bullish tone prevails in the 4 hours chart. We expect a full recovery which will start as soon as the USD/JPY pair rises above the resistance level 117.00. Buyers may move towards 118.00 and 119.00. Otherwise we will see the spot moving towards 115.00.