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Technical Update - USDJPY, EURJPY, GBPJPY & AUDJPY – Are the corrections over?
Kim Cramer Larsson
Technical Analyst, Saxo Bank
Summary: Corrections in JPY pairs could have come to an end.
USDJPY correction seems stretched very short-term and a bounce should be expected.
EURJPY and GBPJPY is testing and seem to bounce from support levels. If taken out the correction mode is very likely to continue
AUDJPY bounce seems strong and could lead to uptrend resuming
USDJPY sell-off has taken the pair below 0.382 retracement down in the consolidation area between 138.80 and 137.85. Just trading around the upper part of the Cloud (Shaded area)
Bears could try to push USDJPY lower towards the 137.36 and the 100 and 200 Moving Average’s
RSI below 40 threshold is indicating lower levels but a move down to the 0.618 retracement would be a bit of a stretch. However, it should not be ruled out if USDJPY is being pushed below 137.80
If USDJPY bounces back above 139 it could continue back above 140 possibly to the 0.382 retracement at 140.74. However, if USDJPY can move back above 142.25 uptrend should be considered resuming.
EURJPY seems to be bouncing from the 0.50 retracement of the last leg up in June at 153.31 and from the lower rising trendline.
A 0.618 retracement bounce at 156.20 could been seen.
However, if EURJPY breaks below the lower trendline a sell-off down to around 150.65 i.e., the 0.382 and 0.786 retracements is in the cards
RSI is still in positive sentiment and needs to close below 40 to change that. The RSI divergence is still intact but if RSI closes back above the 60 threshold GBPJPY uptrend is likely to resume.
GBPJPY seems to be bouncing from lower rising trendline just around the minor support at 179.92.
A break below today’s low a 179.45 GBPJPY could drop to support and 0.382 retracement at around 174.20.
If GBPJPY can crawl back above its 21 daily Moving Average and above 182.50 uptrend is likely to resume with potential to 185-189
RSI is still in positive sentiment and needs to close below 40 to change that. Despite the divergence if RSI closes back above 60 threshold GBPJPY uptrend is likely to resume.
AUDJPY has bounced strongly from support at and 0.382 retracement at around 93.20
RSI has bounced off the 40 threshold and is still in positive sentiment.
There is no RSI divergence indicating AUDJPY is likely to resume uptrend and move back to June highs
A close below 93.18 is likely to send AUDJPY down to around 91.85
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