Transcript of Video
From Forex Traders Daily, this is your daily analysis with Ross Mullins, live from Richmond, Virginia.
Hello everyone, this is today’s video analysis for September 13, 2017. Today we’re going to be taking a look at the US Dollar versus the Japanese Yen [USDJPY] for today’s trade analysis.
First thing I want to point out here on the daily timeframe is that for quite a long time, really since the beginning of the year, mid-January of this year, the vertical red line you see on the left-hand side, we’ve been in somewhat of a large range. The blue box that you see here on my chart, and you could see the trend lines falling from the top to the bottom to the top to the bottom over the past several months. In most recent months, we have been in a downtrend phase of this range. The blue trend line on the right-hand side.
So, very interesting there. Let’s go ahead and zoom it in a little bit, and we could see we’re coming off the bottom of the range. There’s your big blue box there that we were just looking at. The historic support low back here at the green circle, left-hand side of the chart. We hit down there into the 108-level. Suddenly we see this infusion of buy orders, a reversal, and over the past couple of days a significant bullish move for the USDJPY.
A couple of things here. The blue trend line. Of course we are now above that blue trend line, so that gives us some clue that maybe we’re seeing a break of the trend pattern. Where the trend pattern was lower highs and lower lows under the blue trend line, we’re now seeing it push through that blue trend line. So, that’s a clue that we may be seeing a change of the trend pattern.
Another thing is I’ve taken Fibonacci from the highest high of the blue trend line down to our most recent low just about three days ago. High to low with Fibonacci puts the .382 at 110.05. That’s the top of this blue-shaded area that you see here on my chart. We could see along the blue zone historical support and resistance over the past several months as well, so we know that this is a significant decision point. Of course the 110.00-level is also a significant price handle.
So, for me today, as long as we’re above that trend line, above the .382, and above that blue zone, I think it becomes an opportunity to look for a shift of the trend and a continuation of what so far this week has been the momentum, which is a bullish move. You could see the rise from last week. A rise. If that momentum carries through, we’ll look for it to target the next resistance, which happens to be this pink-shaded area here into the 110.65, 110.90-level. And our risk at this point is that the market changes its mind and pushes back under that blue-shaded area and the 109.75-level, and then of course it looks to go back down towards the yellow zone or lower.
But definitely above the blue trend line, above the .382 fib, above the blue zone is giving us a positive thing. Maybe the momentum will carry through. One other thing here on the daily timeframe is our Forex Black Book has shifted from Bearish and red when it was in the downtrend. Bearish and red. Over the past week or so, we’ve now seen, or a few days or so, we’ve now seen it turn green, which gives us a bullish expectation.
Let’s take it down to the four-hour timeframe. Now we could see all of that momentum that’s carried through all week long so far, and take a look at this. We’re sitting just on top of that blue-shaded area as support right now. Four four-hour candles. Four or five four-hour candles sitting on top of 110.05, 110.10. So, again, I would say as long as it sits on top of here, we would primarily be looking for, after this congestion or consolidation, a continuation of the momentum. And our risk, again, is that it turns around and goes back lower again.
Let’s take one other Fibonacci measurement. I’m trying to get it where we could see it. Let’s go ahead and take it from the lowest low down here at the bottom to our most recent high. And by doing that, we now find the .236 at 109.59 or 109.60. So, if we’re going to get into this trade and look for an opportunity to go long, I would say we want to at least have our stop loss somewhere down around this area, just into the 109.50s. That way, we could protect ourselves if the market does continue to turn around and go back down under the blue zone.
But for the day today, sitting on top of here. We do have some news coming up at 8:30AM Eastern US time for the US, so we’ll definitely watch that and see if this gives us bullish again to the USDJPY. But definitely thinking the green trend bar, above the .382, above the blue zone, above the long-term trend line, looking for the carry on through the momentum here back to the pink zone, 110.65, 110.90 as our next resistance target for the USDJPY today.
From Forex Traders Daily, this has been your daily analysis with Ross Mullins. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.