USD/JPY: Technical Analysis 12 Jan 2021

Jan 12, 2021

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

Over the span of four years, USD/JPY carved out a descending triangle pattern between 118.66/104.62.

Although December pursued terrain south of 104.62, January recently arranged a modest comeback and is on course to retest the lower side of 104.62.

104.62 ceding ground throws light on support from 101.70, with a break uncovering trendline support (76.15) and the descending triangle’s take-profit level at 91.04 (red).

Daily timeframe:

Partly modified from previous analysis –

Over the course of four consecutive bullish candles, price recoiled from support at 103.08 and is now within close range of welcoming trendline resistance (111.71), with a break unmasking supply at 106.33/105.78 and the 200-day simple moving average.

H4 timeframe:

Monday, as you can see, made its way above resistance at 104.16. This deserves notice. Resistance is seen around 104.76, spotted just above the 104.57 December 10 peak. Having seen H4 action retesting 104.16, buyers may attempt to make an entrance from this region today.

H1 timeframe:

Demand at 104.03/104.10 (seated just above 104 support), formed in early trading on Monday, provided short-term buyers a platform with which to work with. The next upside resistance falls in around 104.50.

The picture coming out of the RSI indicator right now shows 44.40 support is in sight, with the value lifting above 50.00.

Observed levels:

Partly modified from previous analysis –

Higher timeframe action proposes a move to the lower side of the monthly descending triangle pattern at 104.62, aligning with daily trendline resistance.

H4 support forming a defence at 104.16, along with H1 demand also making a show at 104.03/104.10, advertises a possible bullish presence, with 104.50 and 104.62 (see above on the monthly chart) targeted.