USD / JPY Technical Forex Analysis for Forex Traders

The Dollar/Yen reached the first of the “ideal” targets for this rising correction: short term 61.8% Fibonacci level at 88.01, and then retreated sharply, dropping for more than 100 pips, which could be read as an “exhaustion” in upside activity. Therefore, and even though we are negative about this pair on the medium term, we should not neglect these signs which force themselves upon us for today! Short term support is at the seriously important 86.81, and if broken, the price will resume its drop after a 3-wave correction, targeting 85.84 & 84.81. Resistance is at 88.01. A break here indicates that the odds of a continuation of the correction of the 5 waves down from 92.87 are still massive. This will target Fibonacci retracement levels for the whole drop from 92.87, with the first 2 of them at 88.78 & 89.56. It is worth mentioning that breaking wave 5 bottom 86.25 even with a few pips would strongly indicate the termination of the correction we are currently living, and will officially announce a new wave down!

Support:

• 86.81: Jul 26th & 27th lows, the bottom of the corrective channel, and an obvious hourly support. The most important short & medium term support without a shadow of a doubt.

• 85.84: Nov 30th 2009 low.

• 84.81: Nov 27th 2009 low, and the low of the last 15 years.

Resistance:

• 88.01: Fibonacci 61.8% for the drop from 89.09.

• 88.78: Fibonacci 38.2% level for the whole drop from 92.87 (the 5 waves down).

• 89.56: Fibonacci 50% level for the whole drop from 92.87 (the 5 waves down).