USDJPY still stuck within tight trading range
US Dollar/Japanese Yen (USDJPY) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDJPY finished the week -0.01% lower at 108.51 after edging higher 8 pips (0.07%) today. Trading up to 28 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (USDJPY as at Jan 11, 2019):
Friday's trading range has been 45 pips (0.42%), that's below the last trading month's daily average range of 100 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for USDJPY. Prices continued to consolidate within a tight trading range between 107.77 and 109.09 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bullish Spinning Top and the Takuri Line which are both known as bullish patterns. The last time a Takuri Line showed up on November 23, 2018, USDJPY gained 0.56% on the following trading day.
After having been unable to move above 108.52 in the previous session, the FX pair ran into sellers again around the same price level today, failing to move higher than 108.60.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 109.09 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 107.77 where further sell stops could get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Takuri Line" stand out. Its common bullish interpretation has been confirmed for USD/JPY. Out of 69 times, USDJPY closed higher 53.62% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 57.97% with an average market move of 0.59%.
With four out of the other six Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.71% and NZDUSD closing 0.69% higher. On the flipside the worst performers have been EURUSD closing -0.27% lower and USDCHF losing -0.09%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been NZDCAD surging 0.98% and GBPCAD closing 0.97% higher. The worst performers of the day have been EURNZD tanking -1.04% and EURGBP closing -0.99% lower. Read more