Since the beginning of this year, the USDJPY currency pair has been moving in an uptrend in the form of an upward channel.

  • July maximum started declines on USDJPY
  • inside bar after the downward breakout from the channel
  • US inflation data at 14:30

At the beginning of July, the pair established the maximum at the level of 111.66, at the same time forming an engulfing formation and the price began to fall.

USDJPY H4 - breakout (blue rectangle)
USDJPY Daily – the inside bar appeared after the breakout from the upward channel

Last Thursday, the price broke out of the channel with a significant 115p day candle.
Currently, the price is approaching the defeated support from the bottom within the range of Thursday’s candle, forming an inside bar formation.

USDJPY H4 – a bearish engulfing pattern – blue box

If we look at the H4 chart – we can see that today there was a formation of bearish engulfing (blue rectangle), also called a bearish outside bar. If the downward breakout occurs and the MACD enters a declining phase, it would be a signal for the continuation of the downward correction initiated last Thursday by the aforementioned strong breakout from the channel.

Today at 14:30 we will learn the level of inflation in the USA. These data may lead to increased volatility in gold, JPY, CHF , EUR – therefore it is worth to be cautious in making trading decisions.

By the way, I invite you to an hour-long live trading session Tomorrow, 14.07 at 13:00 GMT+1. Free admission, registration here: TRADING ROOM

I recommend description of the strategy used for this analysis:


ongoing analysis

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