Daily Forex Update: USD/JPY

By: Dima Chernovolov

USD/JPY continues to fall inside the Clear Falling Wedge chart pattern which was recently identified by Autochartist on the 4-hour charts. Autochartist measures the Quality of this Falling Wedge at the 5 bar level – which is the result of the slow Initial Trend (one bar), above-average Uniformity (6 bars) and significant Clarity (8 bars). Higher Clarity reflects the sharpness of the price impulses between the connoting pivots of this chart pattern. USD/JPY is expected to fall further inside this Falling Wedge – in line with the technical analysis shown below.

As can be seen from the daily USD/JPY chart below, this Falling Wedge continues the sharp daily price impulse – which earlier broke through the key support level 110.00, 50% Fibonacci correction of the previous sharp upward impulse from September and the support level 108.94 (previous forecast price calculated for the breakout of the earlier 4-hour Descending Triangle) . The sharpness of the aforementioned daily price impulse adds to the probability USD/JPY will continue to fall inside this Falling Wedge.

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