Hey team,
I've been yapping on about this same particular USD/JPY daily support/resistance zone for literally months now.
All drawn form a simple spike and rejection that I've kept marked on my chart, all the way back in July 2020.
If you're a forex trader, there's no doubt it should be on your charts by now.
Just take a look at the zone on my USD/JPY daily chart below:
USD/JPY Daily:
I've not conducted rocket surgery when it comes to why I chose to draw my support/resistance zone like this.
It's simply the first, obvious big rejection on the daily chart.
Pretty straightforward, right?
You can see that after that marked rejection, there was at least 6 other spikes into and out of the zone.
On both sides of the market.
But with that latest rip higher through the zone, you may be forgiven for thinking that price completely ignored the zone.
But you'd be wrong.
Zoom into the USD/JPY hourly chart and let's take a look at the intraday price action:
USD/JPY Hourly:
You can see that price actually respected the exact 2020 rejection point to the pip, forming a short term resistance zone.
This is just the last red candle that when retested as support, can be used as an entry point.
Price preceded to trade in a very orderly fashion through the zone, retesting short term resistance as support, before ripping through.
Isn't it cool how structured price traded during what looks like a high momentum breakout.
Best of probabilities to you,
Dane.
FOREX BROKR | LeoFinance Blog
Daily market analysis.