Daily Forex Update: USD/JPY

By: Dima Chernovolov

USD/JPY continues to rise inside the Rising Wedge chart pattern which was previously identified by Autochartist on the 15-minute charts. Autochartist measures the quality of this Rising Wedge at the 4-bar level – which is the result of the strong Initial Trend (6 bars), below-average Uniformity (4 bars) and lower Clarity (one bar). USD/JPY is expected to rise further inside chart pattern – in line with the earlier upward reversal from the key support zone shown below.

As can be seen from the daily USD/JPY chart below, the price earlier reversed up sharply from the support area lying between the powerful support level 108.15 (monthly low from April) and the lower daily Bollinger Band. The upward reversal from this support area created the daily Japanese candlesticks reversal pattern Morning Star. The proximity of this support zone and the clear bullish divergence on the daily Stochastic indicator increase the probability USD/JPY will continue to advance inside this Rising Wedge.

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