USD/JPY Moves Closer To Target But Losing Some Momentum

The USDJPY continued its move higher today moving closer to the target resistance level.  The midpoint of the move down from the August 15th high of 110.65 to the low of 87.11 on January 21st comes in at 98.88.  The high today reached 98.19.

When will we know a high may be in place?

This can be difficult, but if you can find an indicator that can give you confidence in a sale from a shorter term chart, it can make the decision easier and less subject to emotion.  The chart below is a 5 minute chart that has a 100 bar (blue) and 200 bar (green) Moving average. As you can see, the 100 bar held resistance a couple times on the way up. Then the 200 hour MA (the green line) provided the support on three different occassion.

On the last test, the price moved below the MA breifly but did not close below it (low was 97.71).   Note also that the decline below the 200 bar MA was preceeded by the new high for the day (at 98.08).   The bounce higher off the 200 hour MA says to stay long.  However, it is clear to see, the momentum is leveling out.  This should keep you on alert for a deeper correction.  If the price were to move below the 200 bar MA again, it would probably be the time to sell (below 97.78) .  A move below 97.70 should confirm lower levels.   The momentum remains to the upside and a move 98.89 is still possible, so if the market moves back above the moving averages, think about getting long again.

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