Hi Traders! Today I am sharing with you the USDJPY forecast and technical analysis post. In this pair based on the multi-timeframe analysis method, we are going to look for the evidences on three timeframes that are on the current trading timeframe and two timeframes higher, when we get evidences that support our view on these three timeframes this makes the setup very reliable. 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! Now, let’s start our analysis from the highest timeframe which will be the daily chart here.

USDJPY D1(Daily) Chart Analysis – Bullish Trend Pattern, Heikin Ashi Candles, ADX Indicator

On the daily chart, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows which we may consider as evidence of bullish pressure. In addition to this currently, there are no signs that show this bullish trend is over yet. Also, the ADX indicator gave a bullish signal at the cross of +DI (green line) versus -DI (red line), and the main signal line (silver line) reads value over 25, we may consider this as yet another evidences of bullish pressure.

Also, based on the Heikin Ashi candles we can see that currently, we have strong bullish bodies in upward moving market conditions so it basically reflects a bullish environment. We may consider this as another evidence 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, ADX Indicator

On the H4 chart, we have a bullish rally and currently, it looks like a correction is happening. Also there are no signs that show this bullish trend is over yet, so until we get any opposite evidences my view remains bullish here. The last divergence we had here is a bullish hidden divergence that had formed between the first low that has formed at 106.673 and the second low that has formed at 108.355 based on the histogram of the MACD indicator. we may consider this as evidence of bullish pressure. In addition to this, the ADX indicator gave a bullish signal here as well at the cross of +DI (green line) versus -DI (red line), and the main signal line (silver line) reads value over 25, we may consider this as yet another evidences of bullish pressure. So everything looks good here for the bulls and we may now move down to lower timeframe and see if we can find evidences supporting this bullish view.

USDJPY H1(1 Hour) Chart Analysis – Bullish Divergence, ADX Indicator, Two Key Support Zones

Looking at the H1 chart we could see that the price which is moving lower has created a bullish divergence between the first low that has formed at 108.556 and the second low that has formed at 108.334 based on the MACD indicator, which we may consider as evidence of bullish pressure. Also, the ADX indicator gave a bullish signal here as well at the cross of +DI (green line) versus -DI (red line), and the main signal line (silver line) reads value over 25, we may consider this as yet another evidences of bullish pressure. In addition to this, we have two key support zones that have formed, the first key support zone is formed based on the 61.8%(108.396) and 100%(108.076) Fibonacci expansion level of the first wave. The second key support zone is formed by the 161.8%(107.558) Fibonacci expansion level of the first wave. Until both these key support zones hold my view remains bullish here and I expect the price to continue higher further.

Technical Analysis & Forecast Summary

USDJPY D1(Daily) Chart Analysis 

• Bullish Trend Pattern, Heikin Ashi Candles, ADX Indicator

USDJPY H4(4 Hours) Chart Analysis 

• Bullish Hidden Divergence, ADX Indicator

USDJPY H1(1 Hour) Chart Analysis 

• Bullish Divergence, ADX Indicator, Two Key Support Zones

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.

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Vladimir Ribakov
Certified Financial Technician

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