USDJPY has been in a bearish trend since the frenzy of the Russian Ukrainge tensions broke out. This bearish trend was in formation of higher highs and higher lows. Now, USDJPY stands at a solid support level at 115.00. This support needs to break and be validated by 2-3 closing candles below the support and at the retest we will take a short position.

The market is clamped between a bearish wedge. If the support trendline is broken out, we will have support + trendline breakout sells, hence confirming double confluence for the breakout. We have to keep in mind the validation rule of 2-3 candles closing below the trendline and support. 

We have drawn a reverse golden retracement level in order to conclude the market move towards the downside. The 0% level is in confluence with the support level. This support level will act as a profit target for our short positions.

EMA 50 was broken out for sells whereas, EMA 200 is being retested at the support level and is on the verge of being broken out for sells. This breakout sell will confluence with out other technical factors of the breakout sells. 

Both the oscillators RSI and CCI are in a bearish region, near their neutralized levels. The best possibility in this case would be that the market breaks the support level, and when retesting the suppor turn resistance, we see a oscillators are neutralized levels. This would be a prime setup for us to enter the market.

We have to keep a hawk eye on the news update on the Russian Ukraine tensions. Market can move either way without being technically correct. If market jumps from this support level, our setup is invalidated.

USDJPY at an important support

Feb 19 2022

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