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USD/JPY

From the October 31st 2011 historical low at 75.38 and after several months of accumulation, since the end of 2012 a strong rally has been bringing the pair above the old key-resistance level at 115, reaching a new top at 121.85 on December 8th 2014, on the last six years’ tops. The ultra-expansionary monetary policy adopted by the Abe administration has produced a strong and generalized depreciation of the yen of such a magnitude never seen in the previous 15 years (-38% vs. the US$ since October 2012 to the January 2014’s top).

After a correction towards 115.50 in mid-December, the pair has been rising again, confirming an enduring bullish technical outlook in a strategic horizon. In order to preserve a strong momentum the price must remain above 117.25 (extensions towards 115.00/50). A new upward impulse would be triggered by a rise above 121.85, targeting the tops around 124.15 reached in June 2007, before the burst of the housing bubble. The outlook would deteriorate below 113.85 (not vey likely at the moment), with a possible correction towards 110.70-112 (extensions towards 110), where the buyers should take control again.

 

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TREND

SUPPORTS

SPOT PRICE

RESISTANCES

Trend 3-6 months

up

S1

117.25

119.45

R3

126.00

Trend 6-12 months

up

S2

115.00/50+

R2

124.15++

Trend 12-18 months

up

S3

113.85++

R1

121.85+

 

EUR/GBP                    EUR/USD                   EUR/JPY                    USD/JPY

Maurizio Milano