USDJPY Annual Forecast – Price Breaks Out From Bullish Flag Formation in 2021
The annual forecast for USDJPY is a break out past the 116.260 resistance zone. This is the next big ambition in the market after the price conforms to a bullish flag formation and breaks out. The downward consolidation helped the buyers switch a potential market drop in their favor. The whole of 2020 was a bearish fall in the consolidation, while the whole of 2021 was a bullish rise and a breakout.
USDJPY Significant Zones
Resistance Zones: 124.030, 116.260
Support Zones: 108.880, 101.430
USDJPY Long Term Plan: Bullish
The market began engineering a bullish flag formation, which drove upward from the 101.430 support zone. Three consecutive candles helped the market rise to 116.260 to create the flag pole. Rejection at this level immediately caused a decline in the market. With the bears threatening to push the market back to 101.430, buyers began forging the market into the bullish flag. Hence, the market bounced up and down the downward channel.
The market’s downward ranging became an annual affair as it lasted for up to 4 years from the beginning of 2017 to the first quarter of 2021. Therefore, the market finally broke out in March 2021 and has been climbing upwards into the year 2022. However, in 2022, the market’s first contact with the 116.260 resistance level is currently resulting in a bearish candlestick. The Stochastic Oscillator suggests a retracement is imminent from an overbought situation.
USDJPY Medium Term Plan: Bearish
On the weekly chart, the price is now retracing. The Stochastic Oscillator has crossed downward from the overbought region. The 50% Fibonacci level represents a good landing spot for the market as it aligns with a level at which price has rested before driving higher to the resistance level.
USDJPY is expected to drive back up from the 50% Fibonacci level and break the 116.260 resistance on the way to reaching 124.030.
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