During this week the price of the currency pair USD/JPY had declined and reached three-week lows of 101.54. The fall was caused by the statement of the chairman of the Bank of Japan Mr. Haruhiko Kuroda, who said that Japanese economy does not need additional stimulation of the monetary authorities.
On Wednesday the pair had corrected and then resumed downward movement. The USD was under pressure from the minutes of the FOMC meeting in March; according to which regulator is not going to raise interest rate even if inflation and unemployment will reach target levels.
Support and resistance
At the moment the pair is nearing the level of 101.60. Break down of this level will enable further decline to the levels of 101.20 and 100.80. Correction to the level of 102.15 is also possible (Presumably, it will coincide with the moving average line of the Bollinger band indicator.
Technical indicators confirm probability of the downward movement. Bollinger bands are directed downwards. MACD histogram is in the negative zone and its volumes are stable. Stochastic lines are directed downwards, approaching to the oversold zone.
In the current situation it makes sense to open short positions from the current price level with take profit at 100.80. Pending sell orders can be placed at the level of 102.15.
Analyst of LiteForex Group of Companies