USDJPY Skyrockets Early in 2022
Pair’s Traders and Fans Rejoice Over Price Skyrocket
USD/JPY skyrockets after price continuously creates support and breaks resistance. This pair has seen reaching this high way back in January 2017. Thanks to the efforts of the American government to deal with Covid-19 and also bullish sentiment for USD that includes the Fed's signals to tapering and interest rate hikes.
Quick Recap on USD/JPY
TL;DR: USD/JPY sees bullish trends on the monthly and weekly TFs and breaking its past resistance on the daily TF.
Let's dive in a little deeper to see how USD/JPY fare on multiple timeframes:
USD/JPY Monthly Technical Analysis
From the monthly timeframe we can clearly see that this pair is in a very bullish trend. Last month, it closed with strong bullish candle, confirming a support that has been created to push UJ even higher at least to 2017 resistance at 117 area. What we can take from this is that it can be a clear indicator that UJ is going to go along with this trend and follow through as long as it closes bullishly every other candle.
USD/JPY Weekly Technical Analysis
The weekly timeframe shows us that UJ is closed bullish for 4 times in a row. Especially when it broke the weekly resistance at 114.3 area. It seems like this pair is going to closed bullish. Lets see how it closed in the next 2 days, though it's very likely that the pair will continue this succession in the coming days.
USD/JPY Daily Technical Analysis
Again, on the daily timeframe, USDJPY is firmly breaking the resistance at 115.450. Yesterday it rejected 116.350 as a key level area. So today, we might see if this pair retesting a previously resistance at 115.450. So, expect some more North-bound movements coming throughout the day.
Trading Idea for USD/JPY
On the 4-hour timeframe, we can draw an up-trendline to connect a low to higher lows. It shows us a confluence with the key level that has been broken. The trading idea is:
Order: Buy Limit
Stop Loss: 114.850
Target 1: 116.350 (50% + BE)
Target 2: 117.00 (25%)
Target 3: 118.00 (25%)
Risk total: 1-2% Equity (Medium Risk Setup)
Reason: Bullish structure, break and retest, confluence key level and up-trendline.
ZFX Analyst’s Predictions
Fundamentally, we already know that the Fed will increase the US' interest rate three times in 2022, once in mid 2022 and two times in end 2022. This alone can bring an impactful reason for appreciation to USD value. Moreover, a new COVID-19 variant; Omicron seems like less dangerous than the previously variants. It also brings optimists to the investors. Meanwhile, the slow movement for Japanese economy will increase the value of USD/JPY. So, in near future, we will see that USD/JPY will reach 117 as the monthly resistance.
Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
ZFX (Zeal Capital Market) is an FCA & FSA licensed online Forex & CFD broker providing more than 100 products for Forex, commodities, stock indices, and share CFDs. Open a trading account with min. USD 50 deposit and download our MT4 trading platform now!