22, May 2014

USD/JPY (a 4-hour chart)

USD/JPY (a 4-hour chart)

General Overview

The pair is downwardly traded. The yen grew against the dollar, but didn’t rise out beyond previously formed extrema, and was limited with the range growth. Obviously, the pressure on pair was exerted by the renewed decrease in the U.S. "treasuries" market yields and the Bank of Japan decision expectations of making at a rate meeting that ended on Wednesday. We doubt that the Bank of Japan will continue to expand its monetary policy tapering the near future.

Four months of long consolidation at 101.35 - 101.45 led to its breakthrough. The breakdown occurred at the diminishing volumes and can lead to consolidation at around 101.15 in the short term.

The price is finding the support at 101.00. The price is finding the first resistance at 101.60, the next one is at 102.23.

There is a confirmed and strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The downtrend movement will be until the price is under the Kijun-Sen.

The MACD indicator is in negative territory.

Trading recommendations

If the price fixates below the support 101, it may continue the downward trend in the short term. The potential targets are 100.90 and 100.40.