USD/JPY Approaching An Interesting Level on Daily Chart
Skerdian Meta • 1 min read
USD/JPY has been moving higher on an uptrend in the last two weeks. But, this week the sellers have returned and this forex pair has been sliding lower. Most of this bearish move this week has to do with the USD weakness that we have seen in all major pairs.
This decline lower is taking USD/JPY to some interesting levels on the daily chart though. As you can see below, after the two dojis a the beginning of the week, the price reversed lower. Those dojis are reversing signals if you don’t know. We have an article explaining candlestick formations if you want to have a look.
Those moving averages should stop the decline in USD/JPY
Now, we are approaching a number of moving averages which are clustered around the 111.50 level. I can see the 100 simple, 100 smooth and 200 smooth moving averages.
This area has provided support as well in November, so it is an important level in itself too. Besides that, the stochastic indicator is becoming oversold, which means that the retrace lower should be over soon, probably by the time we reach the moving averages.
USD/JPY usually dives when the market sentiment turns sour and right now the sentiment is not that bad. So, I think that this retrace will be over soon; therefore I’m looking to buy this forex pair if it slips further down to those moving averages.