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USD/JPY Technicals – Multi-year Fib Broken

4 Hourly Chart

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USD/JPY has been on a one way street since Dec ’12, pushing a 600 pip gain which is even more significant considering its paltry ATR.

Weekly Chart

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The above mentioned rally is so strong that meaningful historical price reference can only be found on high timeframes of weekly and above. Looking at the multi-year strength of yen since the 2007 crisis, we are seeing USD/JPY posting the first higher high, hinting at a potential recovery/ pausing of downward momentum in the Long-Term.

Current price has also broken 23.6% Fib retracement, generally considered a “weaker” fib line with 38.2% Fib a potential target for USD/JPY bulls.

If one is to consider seasonality of Yen, which generally weakens in Feb/Mar, in line with the Financial Year end of numerous Japanese firms, further weakness in Yen could be expected. On top of that, we’ve seen current Japanese PM making waves about “stronger actions” from BOJ before the election. Should Shinzo Abe make good of his promise, follow through on the upside may be even stronger.

 

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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