USD/JPY path of least resistance is down amid ongoing Coronavirus scare – Confluence Detector
Dollar/yen has kicked off the week by stabilizing after falling on Friday and as fears of the coronavirus, outbreak continues gripping markets. How is the currency pair positioned?
The Technical Confluences Indicator is showing that USD/JPY is capped at 108.69, which is the convergence of several lines, including the Fibonacci 38.2% one-month, the Simple Moving Average 10-4h, the Fibonacci 38.2% one-week, and more.
There are several additional resistance clusters awaiting the pair, and a noteworthy upside target is 109.31, which is the meeting point of the Fibonacci 61.8% one-month and the SMA 10-one-day.
Support awaits at 108.24, and it is weaker than resistance at 108.69. At this juncture, we find the Bollinger Band one-day Lower, the Fibonacci 23.6% one-month, and the BB 4h-Lower.
Further down, 107.67 is the downside target, where the PP one-week S2 and the previous monthly low converge.
Here is how it looks on the tool:
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
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