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USD/JPY path of least resistance is up after the fall

USD/JPY dropped amid a worsening global mood: there are more signs of a slowdown and trade talks between the US and China are not going anywhere fast. The yen  is in high demand, but dollar/yen may be limited in its falls.

The  Technical Confluences Indicator  shows that USD/JPY has some support at  110.25  where we see the convergence of the Bollinger Band 4h-Lower, the Simple Moving Average 200-1h, the SMA 50-4h, and the SMA 50-1d.

The most significant cushion awaits at around  110.06  where we see the Pivot Point one-day Support 2, the Fibonacci 23.6% one-week, and last month’s high, a potent mix.

Looking up, the pair faces some resistance at  110.56  where we see the confluence of the Pivot Point one-week Resistance 2 and the previous 4h high.

More importantly,  110.71  is a juncture including the SMA 100-15m, the BB 4h-Middle, and the Fibonacci 38.2% one-day.

All in all, the path of least resistance is to the upside.

Here is how it looks on the tool:

Dollar yen February 15 2019 technical confluence

Confluence Detector

The Confluence Detector finds  exciting opportunities using Technical Confluences.  The TC is a tool to locate and point out those price levels where there is a  congestion of indicators,  moving averages,  Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence  adjacents  price levels. These weightings mean that one  price level without any indicator  or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.