In my earlier post (see Forex Technical Trading: USDJPY just has that correction feeling. Can the sellers keep it going? ), I spoke about the bearish/corrective momentum in the USDJPY today. The price was trading above and below the lower trend line at 120.88 at the time.
I commented that
Looking at the 5 minute chart below, the 100 bar MA (blue line and 38.2% of the days trading range comes in at the 1.2110-12 area. Just above that is topside trend line at the 121.165. Stay below this area today (bullish above/bearish below) and the sellers remain in control in the corrective move lower today.
The price corrected up to 121.07 and the price has rotated lower (see 5 minute chart). Close, but sellers remained in control.
The USDJPY has accelerated below the lower trend line (now at 120.57. The 120.64 is the midpoint of the move down from 120.07 NY high.
The downside targets were outlined as the following:
The 38.2% of the move up from last week’s lows comes in at the 120.318 level. The 100 hour MA (blue line in the chart) comes in at 120.10. These are targets on a continued corrective move down in the near term.
Looking at the hourly chart below the price did reach – and move below the 38.2%. The 100 hour MA (blue line in the chart below) has moved up to 120.186 since this mornings post (from 120.10), and the price just reached and bounced off that level (see chart below).
The stock market’s fall is contributing to the sell off but with the MA holding, the buyers and sellers might be more in balance now. Look for sellers now against the underside of the broken trend line on the 5 minute chart at the 120.57 level. Also the 120.64 is the 50% of the move down from the 120.07 high to the low just reached. Stay below this area, and the sellers intraday still hold the stronger hand, but the 100 hour MA continues to be a support level that could pose problems (and attract low risk bids with stops below).