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19 May 2015
USD/JPY could resume its upside to 122.02 – JP Morgan
FXStreet (Edinburgh) - Analysts at JP Morgan believe the pair could re-visit the 122.02 level once 120.85 has been cleared.
Key Quotes
“Given the lack of a resolution to this consolidation phase, the risk of a repeat to the first half of 2014 continues to rise”.
“Again, this pattern saw USD/JPY maintain a well-defined range until a mid-year breakout”.
“While an upside resolution to the range is still the preferred view, the overall range parameters remain well-defined”.
“For the short term setup, the recent two-sided price action below the April peak highlights the importance of the 118.50/00 support zone”.
“This area includes the range lows from late-March and should define whether a deeper pullback within the broad consolidation can develop”.
“In this regard, violations would target critical support starting with the 116.65/115.49 zone which includes the February and December lows, as well as the 38.2% retracement from the October 2014 low”.
“Alternately, strength above the 120.85 April high should allow for a closer test, if not break of the 122.02 March peak. Note this level should define whether a closer test of the 124 zone (2007 high) can be seen”.
Key Quotes
“Given the lack of a resolution to this consolidation phase, the risk of a repeat to the first half of 2014 continues to rise”.
“Again, this pattern saw USD/JPY maintain a well-defined range until a mid-year breakout”.
“While an upside resolution to the range is still the preferred view, the overall range parameters remain well-defined”.
“For the short term setup, the recent two-sided price action below the April peak highlights the importance of the 118.50/00 support zone”.
“This area includes the range lows from late-March and should define whether a deeper pullback within the broad consolidation can develop”.
“In this regard, violations would target critical support starting with the 116.65/115.49 zone which includes the February and December lows, as well as the 38.2% retracement from the October 2014 low”.
“Alternately, strength above the 120.85 April high should allow for a closer test, if not break of the 122.02 March peak. Note this level should define whether a closer test of the 124 zone (2007 high) can be seen”.