USD/JPY Price Analysis: Dominant uptrend continues

Source Fxstreet
Apr 17, 2024 13:47
  • USD/JPY extends its uptrend into the 154.00s. 
  • It may be forming a Measured Move pattern with an end target of 156.11. 
  • RSI is overbought, however, warning a correction may be on the horizon. 

USD/JPY is trading in the upper 154.00s. It has formed what looks like a Measured Move price pattern composed of three waves, commonly labeled A, B and C. 

In the case of Measured Moves, the end of wave C can be reliably predicted because it is often at the point where wave C is equal in length to wave A, or a Fibonacci ratio of wave A. At the very least wave C normally extends to a 0.618 ratio of A. 

USD/JPY Daily Chart

The end of C if it ends equal to A it will reach roughly 156.11 and there is a chance the rally could extend that high. 

However, it is also the case that price has already reached the conservative target for the end of wave C at the Fib. 0.618 extension of A, at 154.20, which means there is a possibility it may have unfolded to its limit. 

In addition, the Relative Strength Index (RSI) is well into overbought territory, recommending bullish traders with a medium-term outlook should not increase their long bets. If RSI exits overbought it may be a sign USD/JPY is pulling back. 

For USD/JPY bulls the important thing is that price itself continues to rise and as long as it does the uptrend is likely to continue.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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