USD/JPY flirts with a support area, so, technically, the pair could give birth to upside momentum. Personally, I believe that the next few hours are crucial as the US is to release high impact data.
The US retails sales are expected to increase by 0.7% in September, versus 0.6% in August, while the Core Retail Sales could increase by 0.4%. The Industrial Production could register a 0.6% growth, the Capacity Utilization Rate could increase from 71.4% to 72.1%, while the Business Inventories could grow by 0.3%.
Better than expected US data could send USD/JPY higher again after the current retreat. USD needs a bullish spark to be able to take the lead again. A disappointment today could weaken the dollar which could lose significant ground versus its rivals and not only against the Japanese Yen.
The lower median line (lml) of the ascending pitchfork represents strong dynamic support, a critical downside obstacle, so false breakdown through it or a major bullish engulfing could suggest buying. A valid breakdown through the lower median line (lml) and under the S1 (105.18) signals a drop towards the 104.18 area.
The US economic figures will bring high volatility, so maybe you should way away till the markets will calm down. As I've said, a false breakdown with great separation below the lower median line (lml) or a major bullish engulfing printed on this dynamic support should offer is a long opportunity. Also, a valid breakout above the PP (105.64) could signal upside continuation.
A valid breakdown below the lower median line (lml), drop, retest, and stabilization under it suggests selling. This scenario could be caused by poor US data.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.