Morning outlook - USD/JPY breaks long term pattern
Unfortunately for the Yen, the buck traders managed to push the pair through a combined resistance formed by the monthly R2 at 112.54 in conjunction with the upper trend-line of a ten month long falling wedge pattern. Despite such significant breakthrough, the exchange rate continues to fluctuate in two recently formed ascending channels whose cross point might represent a breaking point of another minor rising wedge.
If this assumption is true, the pair might try to slip to the bottom. However, all these attempts are likely to be neutralized by a combination of the rising 55-, 100- and 200-hour SMAs. To put differently, if the pair has indeed left the long-term pattern, it might freely continue to climb to the top, facing no significant obstacles on its way (at least in the short run).
Unfortunately for the Yen, the buck traders managed to push the pair through a combined resistance formed by the monthly R2 at 112.54 in conjunction with the upper trend-line of a ten month long falling wedge pattern. Despite such significant breakthrough, the exchange rate continues to fluctuate in two recently formed ascending channels whose cross point might represent a breaking point of another minor rising wedge.
If this assumption is true, the pair might try to slip to the bottom. However, all these attempts are likely to be neutralized by a combination of the rising 55-, 100- and 200-hour SMAs. To put differently, if the pair has indeed left the long-term pattern, it might freely continue to climb to the top, facing no significant obstacles on its way (at least in the short run).
