USDJPY breaks higher towards 110.80 levels yesterday as the technical direction was clear and discussed here. At times market awaits a trigger to push through its determined trend; it was the Fed interest rate yesterday that provided the same.
USDJPY bulls are looking determined to push through 111.20 levels in the immediate short term, before producing any major pullbacks. Potential remains to push higher towards 112.50 levels in the next few weeks.
Looking at the wave structure USDJPY has been producing a larger degree Wave (C) since 102.59 lows registered on January 06, 2021. Ideally the C wave would unfold into an impulse or a diagonal. In this case it looks like an impulse unfolding.
The rally since 102.59 seems to be progressing in larger degree Wave (3) within the prosed 5 waves rally. Please also note that 3rd of (3) wave was extended while Wave 4 terminated around 107.47 levels respectively.
Since then, USDJPY bulls have been unfolding Wave 5 of (3) higher towards 112.50 levels. Furthermore, lower degree Wave (iii) seems to be progressing towards 111.20 for now. If the above structure unfolds accordingly, prices would stay above 107.47 going further.
Finacademy Technical Team
Gold prices dropped through $1773 lows on Thursday before finding support again. The drop from $1793 was in-line with price action of a gartley.
The US dollar index might have carved a lower high around 96.50 mark on Tuesday. The index dropped through 95.80 levels on Wednesday before finding some support.
USDJPY is soon approaching a formidable resistance zone around the 114.40-50 mark. The currency pair has been carving a corrective rally since 112.50 lows.