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Good afternoon Dear Traders. Today at 16:00 (CET) we will see the consumer confidence and optimism index from the U.S. (IBD/TIPP). This index provides an assessment of economic policy, financial stability and business conditions in the light of consumer perception.

The index is based on a survey of 900 respondents and that is why it is subjective. We would not expect a significant market momentum associated with the index release, but we take a note that volatility due to expectations of the news is possible. Thus, the main role today will be played by the psychological picture of the market, which we will analyze using numerical analysis methods. Opening a position today will be determined solely by technical analysis signals.

USDJPY 4h chart forex dollar yen technical analysis March 4 2014

The Yen today continues to consolidate within a triangle (see the figure), which allows to expect a birth of a new pulse. The Parabolic trend indicator crossed a price and it dropped to a weekly support line, which has a higher priority than the daily line. In this regard, we expect a stronger bullish potential and getting out the triangle to the green zone.

The scenario probability gets higher due to the fact that the price crossed the first Pivot resistance level upwards. At the same time cautious traders should wait for an advanced signal from the RSI-Bars, in other words an upward crossing of the H4 trendline by the oscillator signal line.

A pending buy order is recommended to be placed above 102.293. This opening level is comfortable because when the price crosses it, it is guaranteed that it quits the triangle and gains an upward momentum. The target is based on a maximum closest to 161.8% of Fibonacci slightly below this level.

Further reading: Dollar yen forecast.