The price has increased significantly today and has reached new highs, but unfortunately the bears have stepped in again and have forced the price to decrease again. The pair is almost to erase the earlier gains as the USDX has slipped lower in the last hours. The USDX has increased because was driven by the fundamental factors, but the index has fallen like a rock in the last hour and have pushed the greenback lower as well.
The Yen could still increase on the short term as the Nikkei stock index remains under selling pressure after the failure to make new highs and to reach and retest an important resistance level.
We had some volatility on Trump’s speech, the US President-Elect Donald Trump had spoken at Trump Tower, in New York. Today we had another poor economic calendar, the Yen wasn’t inspired by the Japanese Leading Indicators, which has increased from 100.8% to 102.7%, beating the 102.6% estimate.
Remains to see what will happen on the USDX because the index has edged higher in the afternoon and has jumped above the 102.54 static resistance, the index has retreated again and this could be only a false breakout.
The price continues to stay below the second warning line (WL2) of the former descending pitchfork, you can see that that the price has jumped again above this upside obstacle, but has failed to stay there. The WL2 represents a very strong resistance level, has rejected the price in the last weeks and could send the rate much lower on the short term, the first downside target remains at the lower median line (lml) of the minor ascending pitchfork, could be attracted by the confluence area formed between the lower median line (ml) with the 114.81 static support.
Coud drop even to reach the first warning line (wl1) of the ascending pitchfork and the 23.6% retracement level, could be attracted by the confluence formed at the intersection between these two support levels, we’ll have a larger decrease only if the rate will take out the mentioned support levels, otherwise we could have a bounce back in the coming period.