USD/JPY: long positions remain more rational

30.10.2017 / 10:18

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Forex forecast USD / JPY Our expectations:

Opportunity for long positions from levels of horizontal and diagonal supports with SL at 113.00. Short-term upward movement and price above support levels. Breakthrough over 50% Fibonacci of the medium-term downward movement gives a higher probability of a new upward impulse. The next resistance is at 114.35, as a breakout above it will probably send the price to test 115.50. The price is above the SMA50 and SMA200, with a possibility of a "golden crossing" (SMA50 crossing over the SMA200), which may further enhance the bullish momentum of the pair.

Fundamentally, we can expect a stronger dollar and a weaker yen, as the Fed's monetary policy moves toward tightening, and the BoJs' one to continuing quantitative easing for the economy.

Alternative scenario: If the price breaks below the supports, this will cancel the bullish scenario and we can expect a deeper correction of the latest, short term upward movement.

Trader Nikolay Georgiev

Varchev Traders

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USD/JPY: long positions remain more rational

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