By: Dima Chernovolov
USD/JPY continues to fall inside the clear 30-minute Down Channel chart pattern which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 4-bar level – which is the result of the slow Initial Trend (1 bar), below-average Uniformity (4 bars) and strong Uniformity (8 bars). USD/JPY is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the key resistance area shown below.
As can be seen from the weekly USD/JPY below, the pair recently reversed down from the strong resistance area lying between the powerful resistance level 110.00 (former monthly from last August) and the 50% Fibonacci correction of the weekly downward impulse from last year. The proximity of this resistance area increases the probability USD/JPY will continue to fall inside this Down Channel.
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