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Okay, good morning. David Frank, Chief Analyst at Ava FX, FX Insights today. We’re going
to take a look at the dollar-Yen currency pair. I’ve already opened up my daily chart
and my MetaTrader, and let's take a look at it.
The market made a move. We blasted through the resistance at the top of a triangle consolidation
pattern that we’ve seen going back towards June, and we can see that here and the blast
above. That level was at 79.53. We now are testing, as you can see right here, the psychologically
significant resistance level at 80. That's key. A break about that with a daily close
constructs testing higher. The next significant resistance level above that is at 80.39, which
is right at the top here, that we should be watching.
I do want to point out one thing. Let's take a look at the RSI. We’ve been talking a
lot about RSI in a few of our how-to classes. If you notice the RSI right now, we’re at
70, which could indicate overvalued. As you can see right now, we are testing 80 but we
do have a little bit of a drop down. So with that said, if we do not have a test
of 80 and a significant break above with a close above 80, alternatively what could happen?
We’ll test the former resistance at the top of that triangle that we spoke about,
the former-resistance-now-support at 79.530, which is this pivot right here. A break below
that can then test a significant support level right here at 70.
We do have a few other levels before that at 79.30. Another level below that--we’re
watching this major downward trend here—we do see another support over there as well,
but that shouldn’t come into play today or anytime soon. That level today is at around
78.62, right around in here. Those are some of the significant levels that we should be
paying attention to today as we trade above a resistance testing the 80 level right here.
A break above that, we can test 80.390. Alternatively, because I’m watching the
RSI, should we have a flip, we see former-resistance-now-support at 79.530 break and close below that. We have
the key 79 support level all the way down here.
Alright, that takes care of today’s analysis of the US-Yen currency pair. As always, leave
your comments in the Comment section, and we’ll talk again tomorrow. Have a great
day trading.