The US dollar versus the Japanese yen currency managed to get above the important weekly level of 105.55. Is this a sustainable recovery?
The strong depreciation that came about after the confirmation of the double resistance, made possible by the upper line of the ascending channel and the level of 112.25, extended to as low as the monthly support of 101.18.
From 101.18, the price sharply appreciated, reaching the weekly support of 105.55. Even if the bears tried to confirm this area as resistance, the bulls were able to put pressure on the level. However, the bullish attempts seem only to balance the bearish ones, as their appreciation efforts were limited by the level.
As long as the bulls are only etching highs above the weekly support of 105.55, without achieving to close a daily candle above it, the situation remains neutral. On the other hand, as long the bears are not showing their strength and are only satisfied with rejecting the bullish attempts, again, the situation stays in the grey zone.
But, if the buyers manage to close a day above 105.55, then an appreciation may spark, one that would have 106.79 as the first target. However, if the bulls extend above 105.55, don’t reach the target, and allow the price to fall under the level, then the bears may drive the price towards the 105.00 and 104.00, respectively, psychological levels — not highlighted on the chart.
After printing the low of 101.17, the price commenced an appreciation that later on evolved as a flat limited by the support of 103.18 and the resistance 105.66, respectively.
If the price confirms the double resistance — materialized by 105.66 and the trendline that starts from the 112.00 area — the depreciation could reach the double support of 104.14 and the trendline that starts from 101.17. But if the double resistance gets pierced and confirmed as support, then 107.06 is in reach. Also, if the double support gets confirmed, then the appreciation favors the break of the resistance and eyes the same 107.06
Only if the double support gets taken out, then the price could revisit the lower boundary of the range, 103.18 respectively.
Levels to keep an eye on:
D1: 105.55 106.79 108.18
H4: 105.66 104.14 107.06 103.18
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