Market Analysis: The Bulls’ Run On USDJPY Was Halted by the Resistance Zone
A resistance zone halts the bulls’ run on the USDJPY market. The market bridged the resistance zone at 110.650 on September 24, 2021. The breakaway led to an increase in the market to 115.550. Before the zone was reached, there was a retracement into the 112.750 demand zone. The buyers went long from the demand zone to 115.550. The bears attempted to send the price back to lower levels. This is seen in the volatile move on the 26th of November. The 112.750 zone was well protected. The demand zone was tested again on the 30th of November. The bulls took the price above the previous resistance zone to 116.250, where they got exhausted.
USDJPY Major Zones
Resistance Zone: 116.250, 115.550, 110.659 Support Zone: 113.550, 112.750, 108.950
USDJPY Long Term Trend: Bullish
There was a reversal at the 116.250 zone. The bulls’ run on USDJPY was halted at the resistance zone. The price then sank into the demand zone at 113.550. There was a sharp rejection at the zone on the 14th of January. The rejection in the demand zone triggered a new bull run. The newly initiated bulls’ run was halted two days later. The Moving Average period 9 crossed the moving average period 21. The cross of the moving averages halted the newly initiated bulls’ run and resisted higher pricing.
The market sank back to 115.50 after the cross of the two Moving Averages. The market bounced high into the previous resistance zone at 115.50. The supply level once again held the price below the zone. Prior to today, the market had been bearish for three consecutive days after the zone was reached. The market appears to be diving towards a trend line on the daily chart. The overall trend is still bullish with the Moving Average period 200.
USDJPY Short Term Trend: Bearish
The market is bearish in the four-hour timeframe. The bears are driving the market towards the 112.550 zone. The trend line might resist the bearish move before the zone is reached. The trend line might propel a bull run just before 112.550 is reached. All three Moving Averages are still above the four-hour candles, signifying bearishness in the lower time frame.
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