USDJPY Price Analysis – July 15
A close above $108 may open up a rally towards $109 price level which is more than 100 pips to the ranging zone. Any further close above the just mentioned level may extend the rally to $111.
Supply levels: $108, $109, $111
Demand levels: $106, $105, $103
USDJPY Long-term Trend: Ranging
USDJPY is yet to break out of the consolidation zone on the long-term outlook. Nearly three weeks ago; June 23 precisely, USDJPY broke below the demand level of $106, along the way the sellers lose momentum and the price rallied to the supply level at $108, yet failed to break above it. The currency pair rebounded from the aforementioned price level and commences consolidation within the $108 and $106 price levels.
The high end of the ranging zone is found at $108 and a close above it may open up a rally towards $109 price level which is more than 100 pips to the ranging zone. Any further close above the just mentioned level may extend the rally to $111. Considering the flip side, a close below the end of the ranging zone may lead the currency pair to fall towards the $105 demand level, and a further decrease in price may encourage the seller to revisit $103 price level. However, the Relative Strength Index period 14 is at 40 levels with the signal lines bending towards the south to indicate sell signal.
USDJPY Medium-term Trend: Ranging
The ranging movement continues on the 4-hour chart. Last week Friday, USDJPY was trading within the horizontal channel. The sellers were trying to push the price to the last month low but the demand level of $106 price level prevented the breakout. It rebounds to test the upper trend line of the channel but unable before the bears interrupted and USDJPY found support at the previous low today.
A break below the $106 price level could send the price towards the demand level of $105. At the same time, a break above the supply level of $108 may cause the pair to rally towards the $109 price level. However, the price is trading below the two EMAs with strong bearish candle which connotes strong bearish momentum.