Forex Video Briefing (11/24) – USD/JPY Uptrend Continuation
The 1H chart shows that the brief correction found support at 117.35. After a couple of failed attempts to break lower, price started to rally. To start the week, price returned above the 50-hour simple moving average, making the 1H chart all bullish. The RSI continues to hold above 40 after tagging above 70, showing persistence of bullish momentum. As price popped up above 118.00 today, USD/JPY looks ready to threaten the 119 area for bullish continuation.
The market might slow down around 119 ahead of tomorrow’s US Q3 GDP data release. The preliminary, which is the second, reading of GDP growth rate in annualized terms is expected to be revised down to 3.3% from the advanced estimate of 3.5%. With the USD/JPY already bullish, a reading above 3.3% should guide the pair easily above 119 towards the 120 handle, where we should start anticipating resistance. Now if the GPD reading misses 3.3%, we should expect some consolidation. In this scenario, monitor 118. If 108 still holds as support, there is still bullish bias, and the pressure will remain on 119.
However, if price is able to dip back below 118, we are likely in a short to medium-term consolidation with pressure on 117.35, and further downside risk to 117.00. Then, if price starts to hold below 118.00, we can expect a more significant bearish correction to push below 117.0, for example towards the 115.40-50 support area.