Hi Traders! USDJPY forecast and technical analysis is here. We do our analysis on the MetaTrader4 platform (MT4). Some very interesting and useful tips and hacks about the MT4 platform could be found here. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available! This analysis will be based on price action trading (if you want to learn about price action trading, you can watch this video here).
USDJPY D1(Daily) Chart Analysis – Key Support Zone, Bullish Convergence, RSI Indicator
On the daily chart, the price which is moving lower has reached a key support zone formed by the 161.8%(102.014) Fibonacci expansion level of the first wave and the 100%(103.037) Fibonacci expansion level of the second wave we have. The price is currently bouncing higher from this zone. The price has also created a bullish divergence between the first low that has formed at 102.869 and the second low that has formed at 102.588 based on the MACD indicator. Then the price moved higher and broke above the high at 103.894 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently, it looks like the correction that we were looking for is happening. Also, we have a downtrend line breakout based on the RSI indicator, we may consider these as other evidences of bullish pressure. We may now move down to lower timeframe and see if we can find evidences supporting this bullish view.
USDJPY H4(4 Hours) Chart Analysis – Bullish Hidden Divergence, Potential Bullish Divergence, Stochastic Oscillator, Strong Support Zone
On the H4 chart currently, it looks like a correction is happening in the form of a double wave down. We also have a bullish hidden divergence that has formed between the first low that has formed at 102.588 and the second low that has formed at 103.520 based on the MACD indicator which we may consider as evidence of bullish pressure. The price is also creating a potential bullish divergence based on the MACD indicator. In addition to this based on the Stochastic Oscillator, we could see that the price has reached its extreme and there are no signs opposing this bullish view. Also, we had a strong resistance zone that had formed and the price which is moving higher has broken above this strong resistance zone and is holding above it. Currently, this strong resistance zone is acting as a strong support zone for us. Until this strong support zone holds my view remains bullish here and I expect the price to move higher further.
Technical Analysis & Forecast Summary
USDJPY D1(Daily) Chart Analysis
- Key Support Zone, Bullish Convergence, RSI Indicator
USDJPY H4(4 Hours) Chart Analysis
- Bullish Hidden Divergence, Potential Bullish Divergence, Stochastic Oscillator, Strong Support Zone
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
Also, don’t forget to protect your buy trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Yordan Kuzmanov
Chief Trader at the Traders Academy Club
