USD/JPY Could Move Soon

By: Mike Kulej

Most of the currencies have been lively over the last few weeks. The Yen crosses had large moves, and so did the Dollar pairs. However, the USD/JPY itself remained about the most lifeless of the majors. Except for the period of the “flash crash”, this pair has been moving the least and without any directional conviction. Seems that this choppy stretch might be ending soon, though.
On the daily chart of the USD/JPY, we can see how the price action contracted sharply lately. Movements are smaller and smaller, bringing this pair to 91.60 level, roughly the middle of the last main price swing from 95.00 to 88.00. When the minor highs and lows are connected, a symmetrical triangle is formed on this chart. This is often a harbinger of a larger move.
Unfortunately, the symmetrical triangle is not a good forecasting tool when it comes to predicting the direction of a breakout. Before getting on board, one might consider waiting for the price to move first. However, we should see the USD-JPY to come out of this tight formation soon, and eventually reach either 95.00 or 88.00, once the direction is decided. And that could happen as early as this week.

Forex Technical Analysis- USD/JPY Could Move Soon

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