USD/JPY (a 4-hour chart)
The third quarter US GDP final data strengthened expectations that the US Federal Reserve would increase interest rates this year and, on the contrary, the Bank of Japan will increase the Bank of Japan QE program. The debt market dynamics also confirms optimism about the dollar: the US and Japan government bond yields are expanding which increases investments’ attractiveness into the US assets.
The pair dollar/yen continues its southern movement. Overcoming support 120.40, the price was fixed below it.
The price is finding the first support at 119.20, the next one is 118.40. The price is finding the first resistance at 120.40, the next one is at 121.60.
There is a non-confirmed and a strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen and the Kijun-sen show a horizontal movement and form a “Golden Cross”. The downward movement will be until the price is under the Cloud.
The MACD indicator is in a negative territory. The price is correcting.
We suppose the pair will go to 120.40 first. Having overcome the first target the price might go upwards to 121.60.