FX.co ★ Forecast of USD/JPY for 2014

USD/JPY- monthly basis

USD/JPY has been in an uptrend from 75.57 levels (October 2011), and it travelled all the way to 105.44 levels (January 2014). It exactly travelled up to 61.8 fib level (from June 2007 high of 124.13 to 75.57 lows). The pair made a double top at 105.44 levels and has been traveling to the downside for the last 4 weeks. In the monthly chart, RSI is not favoring bulls. For the last 2 weeks the pair has been facing strong resistance at the 200 monthly EMA and it was unable to cross this level. The pair is witnessing a flag pattern. It results the target at 130 levels. But the uptrend is postponed, when the RSI is cooled off we can re-analyze the charts once again for a fresh buy recommendation. The fresh bull run will again ignite once the pair trades above the 105.44 levels. The slight bullish thoughts will ignite once the pair trades above the 200EMA, the powerful bull run will start only above 105.44 for an immediate target at 110.66 (August 2008 high). On the down side, the pair has a strong support zone between 100.79-99.95. Once the pair breaks the support, it will fall to 97.60, 96.5, and 93.80 levels.

Weekly basis-

The pair is in a consolidation phase, and in the weekly chart the RSI is forming a symmetric triangle which resulted in the big move in the month of May, either break down/up will tell. Please be patient and stand firm. The level of 100.65 (50SMA) is proving strong support. The pair has strong support between 101.33-101.2-100.65, 99.95 is the monthly support. Bears will have an upper hand only below 99.95 for 98.30, 97.60, and 96.60 levels. On the upside, if the pair breaks the 103.40 level, traders can buy for 104.10 as a immediate target, above this, 105.50 is the resistance zone. Safe traders can enter longs only above 105.54 for 110.6 and 116.50 levels. A weekly close below 50SMA (the 100.65 level), we expect a correction to start up to 92.5 levels.

Recommendations- April 23-25, 2014