USDJPY Remains Bullish Against 104.00 Support
30 September 2020
USDJPY might have carved a meaningful bottom around 104.00 levels around September 21, 2020. The currency has since managed to rally past 105.80 levels before pulling back. It is trading just below 105.50 levels for now, as bulls prepare to resume higher towards 107.00/50.
USDJPY probable wave count since 101.18 lows in March 2020 is as follows: The rally between 101.18 and 111.75 can be labelled as Wave 1 or A (not seen here). The subsequent drop from 111.75 through 104.00 could be marked as Wave 2 or B.
If the above structure holds true, USDJPY should remain above 104.00 and continue pushing towards 111.75 levels as Wave 3 or C progresses further. Immediate resistance is seen towards 107.00/50, and a push beyond that would be encouraging to bulls.
At the moment USDJPY is facing resistance around the recent down trend line around 105.80 mark. A push through that will open doors to take out 107.00/50 resistance, going forward. Also prices would enter into the buy zone of the resistance trend line.
Once USDJPY enters into the buy zone of its resistance trend line the currency turns further bullish and a good candidate to be bought on dips. Near term support should be seen towards 105.20/25 mark, potential lower degree wave iv.
Traders might remain poised to hold on to long positions taken around 104.00 support, with protective stop just below 104.00 and projected targets above 107.00/50 levels respectively.
Prepared by
Technical Analysis Team
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