Daily Video—USD/JPY Searches For a Bottom as we Wait on the Fed

USD/JPY (¥117.034)

• Resistance Levels: 119.40, 120.40, 121.85
• Support Levels: 117.35, 115.50, 113.50

The USD/JPY has been losing value as the Dollar lost momentum then turned lower. This occurred after the formation of a Three Inside Down Candlestick. Please refer to the above daily MT 4 chart.

My daily analysis on the USD/JPY remains the same from yesterday. I was correct not to enter a short trade as we were too close to a support level. Right now the USD is hunting for a bottom to turn higher. Investors are eying the Fed due out later today as we all want to hear rates will remain lower for the foreseeable future.

We need a daily close below the congestion zone that runs from 117.35 to 117.90 to open the doors for the next technical level at 115.50. Should the U.S. Dollar reverse and gain value we need to close back above 119.40 in order to test the next technical resistance level at 120.40. This level is supported by the trend line.

My trading strategy today, like yesterday, is to stand aside. The timing is still not right, based on a risk to reward perspective, to place a short trade. We are trading to close to a support level that lies at 117.35. There are also no bullish reversal signals to justify a long trade. Another factor is the Fed. I will wait on a more actionable signal before jumping in.

As always, trading strategies are educational in purpose and do not constitute trade advice. Always perform your own technical analysis to support my conclusions before placing and trade.