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USD/JPY Stalking Gartley
- Daily and 4H: We ended the week mentioning the lack of bullish or bearish signal. (Refer to Weekly Technical Update 11.06.2009).
- The greenback was broadly weaker to start the week. While this dollar weakness pushed pairs like EUR/USD and GBP/USD above resistance, it only brought the USD/JPY to short-term support at about the 89.75 area. This however, is actually above the support, and would create a higher bottom, indicative of a weak bearish attempt. Thus our scenario marked “1″ is still viable.
- We should however consider scenario “2″ where the market declines back to the long-term support zone starting at 88.00. .
- While dollar weakness was significant against the Euro and Sterling, it was not so against the USD/JPY. In fact this adds to the bullish case. Let’s look at the 1H timeframe for more details.
USD/JPY Gartley
- 1H: We see that the projected Gartley Completion worked well as support, coinciding with the 78.6% retracement area.
- If this support holds for the next 2 sessions, we may see a rally towards 90.40, a coincidence of resistance, 78.6% retracement, and projected gartley completion.
- There may be some resistnace at 90.40, but that is where we will be watchful of how the market reacts. If the bulls are strong enough, we may have a break after some pause at 90.40.
- We need to continue stalking the pair since it is still in range. A break above 90.40 may have significant implications.
Fan Yang
Currency Analyst,
Commodity Trading Advisor
