Although we have a possible inverted head and shoulders pattern forming on the 4HR time frame the bulls will have their work cut out for them.The USDJPY rose as high as 107.29 yesterday, but the US policy unease and the resulting drop in the US stocks and the treasury yields pushed it back to 106.30 in Asian session today.
The retreat highlights how difficult it is going to be for the USDJPY to see any kind of meaningful gains in the near future.
We are sitting on daily and near weekly support and a break below these levels would void the head and shoulders pattern.
USDCAD in red, trading above 1.2900
The USDCAD pair is extending the rangebound theme in the 1.2940/50 region so far today, shedding some ground following Tuesday’s peaks around 1.2980.
Currently forming a possible flag formation at the top of the bigger flag formed on the daily time frame after it failed to break resistance. Either a short is eminent or the loonie will break to new highs.
The NZDUSD has bottomed out of Wednesday’s trading range on a miss for New Zealand GDP figures, currently testing just above the 0.7300 handle, and the pair heads into Thursday’s Asia session on the backfoot and at the mercy of teetering risk sentiment in the broader markets.
The current flag formed on the 4HR time frame is trading within daily support and resistance levels and a break of these is need to further any trades short or long.
Technically, the 4 hours chart shows that the pair remains trading between support and resistance levels after breaking the channel as well as also trading above the 20 SMA, in the mentioned time frame, while technical indicators hover within positive territory, with no clear directional strength. The mentioned 20 SMA stands around 1.3910/20 providing an immediate dynamic support, for the upcoming sessions.
Support levels: 1.3960 1.3915 1.3880
Resistance levels: 1.4000 1.4040 1.4085
The GBPJPY is heading lower in the early Tokyo session as traders pile back into the Yen on risk aversion and the pair is currently testing the 147.90 area.
Currently trading on a daily trendline with a rising wedge pattern nearing completion. A break below this level will see the continuation to the downside.
The EURUSD pair bounced as temporal dollar’s demand seems to be over, with the greenback also pressured by another bad day in Wall Street.
Yesterday the pair failed to break daily trend line resistance level and fell back into the descending wedge pattern and trading near 4HR trend line support level.
A break below this level will warrant the short trade and on the flip side a break above the daily trend line resistance level will warrant the upside move.