Trade of the Day: USD/JPY

By: Dima Chernovolov

USD/JPY continues to fall inside the 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 reflects the slow Initial Trend (3 bars), above-average Uniformity (6 bars) and lower Clarity (3 bars). USD/JPY expected to fall further inside this Down Channel – in line with the earlier downward reversal from the powerful resistance area shown below.

As can be seen from the weekly USD/JPY chart below – the pair earlier reversed down sharply from the major resistance area lying between the long-term resistance level 112.00 (which has been reversing the price from the start of 2019) and the upper weekly Bollinger Band. The proximity of this resistance area increases the probability USD/JPY will continue to fall inside this Down Channel.