USDJPY unable to break through key resistance level
US Dollar/Japanese Yen (USDJPY) Technical Analysis Report for Nov 08, 2019 | by Techniquant Editorial Team
USDJPY finished the week 0.99% higher at 109.25 after losing 3 pips (-0.03%) today. Trading 19 pips higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on October 30th, USDJPY lost -0.74% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (USDJPY as at Nov 08, 2019):
Friday's trading range has been 40 pips (0.37%), that's slightly below the last trading month's daily average range of 47 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for USDJPY.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 109.29 (R1), USD/JPY closed below it after spiking up to 109.48 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. After having been unable to move above 109.49 in the previous session, the FX pair ran into sellers again around the same price level today, failing to move higher than 109.48.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and might now be heading back down towards the mean of the Bollinger Bands at 108.72.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 109.49 where further buy stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for USD/JPY. Out of 469 times, USDJPY closed lower 52.88% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 52.88% with an average market move of -0.10%.
With four out of the other six Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -0.61% and AUDUSD closing -0.57% lower. On the flipside the best performers have been USDCAD closing 0.4% higher and USDCHF gaining 0.23%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 0.79% and USDSEK closing 0.75% higher. The worst performers of the day have been ZARJPY tanking -0.81% and NZDJPY closing -0.63% lower. Read more