Trying Prior Support in USD/JPY after A Bearish Chart Setup
Skerdian Meta • 1 min read
USD/JPY has been trending down since early July and after several months of solid support at the 108.00-108.80, it finally broke, diving down to 107.30.
It has climbed back up since touching the bottom, and today we are trading back above 108.
Looking at the hourly forex chart, I spotted a nice chart setup in this forex pair, so we issued a sell forex signal. We sold USD/JPY at 108.50, targeting 25 pips with the first TP target, then we’ll adapt as the market progresses.
What’s the chat setup though?
The gap should be closed.
The gap is the first signal that we might turn down, at least until 107.80, which was the closing price on Friday. You know that gaps are supposed to be closed, right?
Besides that, the 100 SMA (green) has been providing resistance this morning, an indicator of pointing down.
If we switch to the H4 chart, the situation looks even more bearish. You see that the trend is strongly down, so the pullback today is just a retrace before the downtrend resumes.
Prior support has now turned into resistance.