USD/JPY Looks Good for Sellers, but it’s too Dangerous to Trade Right Now - Forex News by FX Leaders
Looks like we will see another bearish move soon in USD/JPY

USD/JPY Looks Good for Sellers, but it’s too Dangerous to Trade Right Now

Posted Thursday, January 3, 2019 by
Skerdian Meta • 1 min read

Yes, the flash crash took place last night between the US session and the Asian session. That is the time when liquidity is the thinnest in normal markets; right now we are not in normal trading conditions yet, as major players in forex are still in holidays and they will be back next week.

Those guys know how to live life, don’t they? Anyhow, the thin liquidity is mostly responsible for that massive move last night, otherwise there is no reason that the Apple downgrade guidance could induce such volatility.

USD/JPY dived more than 4 cents in a matter of minutes, piercing the big round level at 105. Although, it has pulled back now and is trading at 107.60-70 at the moment. The stochastic indicator is almost overbought on the H1 chart as you can see above. That means that the retrace higher is complete.

Besides, the 20 SMA (grey) has caught up with the price now and it should provide some solid resistance on the top side. The last two hourly candlesticks formed two dojis/pins which are reversing signals, so there is a good chance that this pair resumes the bearish trend soon.

But as I said, these are not normal trading conditions yet so it is a bit dangerous trading this pair in particular now. Although, if you have the urge to trade, the downside looks more favorable by the market right now.

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About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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