Price to Take Decision on USD/JPY After 106.22 Peak

The United States dollar versus the Japanese yen currency pair seems to be in front of a medium-term or even long-term decision.

Long-term perspective
After — in the context of the downtrend — the validation of the double resistance area noted by the falling trendline and the 107.00 zone left behind the 106.94 lower high, the bears got the arguments they needed to continue sending the price towards the south, which they did until reaching the 102.59 low.
The rotation from the 102.59 lower low was expected to draw yet another corrective phase on the chart. However, differently from the last times — see the 106.94 and 105.67 lower highs, respectively — the bears were unable to start a definite fall from the new lower high of 104.39.
As the drop took longer and longer to form, apparent on the chart became an angled rectangle — and as this chart patterns, usually, facilitate the continuation of the movement that preceded them, and since this time the formation followed a rise, the double resistance area defined by the falling trendline and the 103.74 intermediary level gave way, allowing the price to climb until the 105.76.
From the 105.76 high, what was expected to be a throwback commenced. Still, the price did not stop at the 105.09 level — as it should — to confirm it as support, sliding instead under it and continuing to decline until the 104.40 low.
Even if the bears wanted to send the message that the 105.76 high is part of the false piercing of the 105.05 level, the bulls saw a price that favored them from an area — see the previous 104.39 peak — that looked just too good not to be confirmed as support.
As a result, the bulls thrust the price to the next resistance, the 106.12 intermediary level, printing the 106.22 high. If they manage to validate the peak of 105.76 as support, then they have a shot at conquering 106.12, which, if they do, allows them to extend their gains to the 107.00 objective.
However, if the fall from 106.22 simply continues, 105.09 may be paid a visit.

Short-term perspective
From the 103.55 low, the bulls climbed to the 105.76 high. After failing to find support at the 105.27 intermediary level, the price was sent to the next support area — 104.44.
Once there, the bulls took hold of the situation, crafting an advancement that brought the price to the 106.02 level.
If the bulls succeed in validating 106.02 as support, then they can eye 106.77.
On the flip side, if 106.02 remains a resistance area, 105.27, followed by 104.44, is the next bearish stop.

Levels to keep an eye on:

D1: 106.12 107.00 105.09 and the peak of 105.76
H4: 106.02 106.77 105.27 104.44

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Original from: www.earnforex.com