Daily Forex Update: USD/JPY

By: Dima Chernovolov

USD/JPY continues to rise after the earlier breakout of the Down Channel chart pattern which was recently identified by Autochartist on the daily charts. Autochartist rates the quality of this Down Channel at the 7-bar level – which is the result of the sharp Initial Trend (10 bars), average Uniformity (5 bars) and significant Clarity (8 bars). USD/JPY is expected to reach the forecast price 112.07 – in line with the earlier breakout of the resistance zone shown below.

As can be seen from the daily USD/JPY chart below, the active sharp impulse wave which broke this Down Channel also recently broke the resistance area lying between the resistance level 110.70 and the 50% Fibonacci correction of the downward impulse from the top of this Down Channel. This price area is acting as support zone after it was broken. The proximity of this support zone increases the probability USD/JPY will continue to rise toward the forecast price 112.07.

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