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USDJPY: Pushing downward

Since the beginning of the year the currency pair lost over 4.0% but last week ended with a loss over 1.0% and made a phase change, shifting from a bullish to a warning phase.

Last week the USDJPY fell with a wide range and closed near the low of the week, in addition managed to close below the previous week low, which suggests a strong bearish momentum.

The stochastic is showing a overbought market and is displaying a strong bearish momentum although is above the 50 mid line.

The currency pair remains in a consolidation zone that began in mid-April and goes from 114.537 down to 108.78.

Expecting a downward move to a Fibonacci retracement at 109.925 on a break below the previous week low at 111.943 (scenario 1) however a bounce from the Fibonacci retracement at 109.925 may fuel an upward correction to the 38.2 Fibonacci retracement at 111.986 (scenario 2).


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