Daily Market Report – USD/JPY Looking For A Deeper Correction August 04, 2017

USD/JPY Additional Drops On The Cards

The USD/JPY dropped significantly on Thursday and erased the last two day’s gains, should touch new lows because the Nikkei stock index is still expected to drop in the next days. Price moves sideways on the Daily chart, but I hope that we’ll have a clear direction very soon.

It is expected to breakout from the symmetrical triangle, but remains to see the direction. A breakdown looks imminent at this moment because the Yen could dominate the currency market if the JP225 will drop towards the 19700 major static support.

Technically and Nikkei’s drop is natural after another failure to stabilize above the 20058 long term horizontal resistance. The Japanese currency will appreciate aggressively versus the other major currencies if the Nikkei will drop below the 19700 major static support (resistance turned into support).

Japan is releasing the Average Cash Earning later, which is expected to rise by 0.5% in June, less versus the 0.6% growth in the former reading period. We may have some volatility in the afternoon as the US will publish some high impact data.

USD/JPY move within a symmetrical triangle, should hit the downside line of this pattern in the upcoming hours and the 50% retracement level. Support can be found also at the warning line (wl1) of the minor ascending pitchfork. A valid breakdown below the mentioned support levels will open the door for more declines in the upcoming weeks, only a rejection along with a JP225 increase will send the rate higher again.

Price is trading right below the 110.00 psychological level, but we’ll see how will reach when will touch the mentioned support levels.

USD/CHF More A Buy Than A Sell

USD/CHF decreased in the last session, but maintains a chance to reach new high in the upcoming period. Could decrease to retest the 0.9634 static support before will try to take out the dynamic resistance from the median line (ml). I’ve said in a previous report that we may see a minor consolidation above the 0.9634 level before the rate will have enough energy to jump much higher.

NZD/USD Downside Paused

Price edged lower on Thursday, but failed to reach the 23.6% retracement level and the 0.7375 static support. Maintains a bullish perspective, despite the minor decrease, could bounce back if the support will hold. Only a valid breakdown below the mentioned support levels will open the door for more declines. We may have a minor consolidation here before will start a significant move.

By Olimpiu Tuns

Market Analyst

Risk Disclaimer:

Trading in general is very risky and is not suited for everyone. There is always a chance of losing some or all of your initial investment/deposit, so do not invest money you can afford to lose. You are strongly advised to carry out your independent research before making any trading decisions. All the analysis, market reports posted on this site are only educational and do not constitute an investment advice or recommendation to open or close positions on international financial markets. The author is not responsible for any loss of profit or damage which may arise from transactions made based on any information on this web site.

The post Daily Market Report – USD/JPY Looking For A Deeper Correction August 04, 2017 appeared first on mexgroupblog.

Source:: Daily Market Report – USD/JPY Looking For A Deeper Correction August 04, 2017