Forex Trading Library

Intraday Analysis – JPY sinks further

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USDJPY breaks major resistance

Chart of USDJPY

The Japanese yen recouped some losses after a jump in April’s CPI. A close above the double top (137.60) on the daily chart signals a comeback of the dollar and could pave the way for an extension towards 142.00. The psychological level of 140.00 would be the first hurdle. The RSI’s repeatedly overbought situation may briefly temper the bullish drive to let the bulls catch their breath with the base of the latest breakout at 137.40 as a fresh support. Further down, 136.30 would be the bulls’ second level of defence.

XAGUSD struggles for bids

Chart of XAGUSD

Silver slides as traders stay optimistic about the US avoiding a potential default. After hitting a roadblock at a 13-month high of 26.00, a bearish MA cross on the daily chart suggests that sentiment has soured. A fall below the lower end of the consolidation range at 24.60 led to more exits from buyers, turning the area into a supply one in the process. The psychological level of 23.00 sits at the 50% retracement of the March rally and is a key level to expect renewed buying interests. 24.20 is the first resistance to lift should this happen.

SPX 500 bounces higher

Chart of US500

The S&P 500 rallied after Washington signalled a possible deal to raise the federal debt ceiling. A pop above 4150 and the consolidation range has put the index back on track, prompting the short side to cover. A close above the recent peak and daily resistance of 4185 would reinforce the bullish mood and resume the recovery in the medium-term, with 4250 then the August 2022 high of 4310 as potential targets. On the downside, 4150 at the start of the breakout is important in keeping the current momentum intact.

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