27, January 2016

USD/JPY (a 4-hour chart)

USD/JPY (a 4-hour chart)

General overview

The United States can please traders with the positive Consumer Confidence data amid real incomes growing. The real income growth rate peaked in the last nine years which together with low unemployment (5%) contribute to the consumer optimism growth.

However, the bond market is showing the USA and Japanese government bond yield differential decrease which does not allow counting on strong price growth.

The first support resides at 118.40, the next is at 117.80. The first resistance lies at 119.20, the next one is at 120.40.

There is a confirmed and a strong buy signal. The price is above the Ichimoku Cloud and it is above the Chinkou Span. The Tenkan-sen and the Kijun-sen show an upward movement forming a “Golden Cross”. The upward movement will be until the price is above the Cloud.

The MACD indicator is in a positive territory. The price is growing.

Trading recommendations

The pair can grow to the resistance level of 119.20. Should this mark be reached successfully, a further extension towards 120.40 is possible.