The USD/JPY fell to this year’s lowest level as demand for safe haven currency increased and China inflation data. The strengthening yen is not good for Japan’s economy. Weakening the yen is necessary in order to help exports and boosts inflation.

Worries that the Bank of Japan has run out of options to fight deflation have intensified after a sharp rise in the value of yen pushed the policymakers to talk down the value of yen in Tokyo.

USDJPY 11 APRIL 2016

From the techincal analysis point-of view, the yen still has the chance to strengthen again since USD/JPY remains capped by negative trendline on hourly chart. A pull-back move has occurred to within the Fibonacci area at 108.170-108.527. 20 MA and 50 MA are still falling on hourly chart. Hourly stochastic and CCI are overbought. As today’s trading strategy, we can look for bearish signal confirmation within the Fibonacci area with target at 107.966-107.620.

Note that the price is testing the negative trendline area. Be careful if the price managed to break the resistance at 108.527 because it will turn the intraday bias to bullish and possibly will be followed by a bullish move up to 109.773-109.087.

2 thoughts on “USD/JPY Remains In Downtrend; 11 April 2016”

  1. Daniel Chan - Forex.Today says:

    Thanks Eko . Is this a double bottom ? interesting area I am looking for reversal up for USDJPY.

  2. Eko Trijuni says:

    Sorry for the late reply… Yes, it was an emerging double bottom. However, it was not a double bottom yet until it broke 109.087. When I wrote this article, the pair was still capped by negative trendline as seen on the hourly chart. Having the price testing the trendline, added with overbought stochastic and CCI on hourly chart, I preferred to be bearish. However, I anticipated the possible breakout of the resistance at 108.527 as I wrote in the article. Once the resistance was broken, I went long on USD/JPY.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.