Ichimoku patterns : USDJPY

USDJPY is continuing to track higher since last week, building on the rising momentum in Treasury yields, supported by the NFP report on Friday. The pair has pushed past the 23 July high at 110.59, with the 14 July high at 110.70 in focus now. If buyers manage to push higher, the 111.00 level is the next psychological resistance before getting to the year's highs around 111.65. The momentum is siding with buyers as the focus in the market leans more towards more positive Fed taper expectations. That said, COVID-19 fears amid delta variant concerns are still a key risk that needs to be monitored in case it brings about a fresh wave of risk aversion in the market. 

Monthly interval :

The year began with a bullish signal when the bearish trendline linking the highs since 2015 was broken. Since then, the pair is facing the ichimoku cloud, acting as a resistance. If the USDJPY manages to break through the cloud upwards, crossing the level at 112.400, a bullish signal would strengthen the bullish outlook. Such a signal would be immediately confirmed by the Chikou Span which would emerge from the cloud at the same time.

USDJPY, M1 interval, Source : xStation5

Daily interval :

From an Ichimoku point of view, today's session will be crucial. In fact, a buy signal would be generated in case of a daily close above the cloud (second yellow circle). This signal would be immediately confirmed by the Chikou span (green bold line inside the first green circle) which would be released from any obstacle.  In this case, the 111.00 level is the next psychological resistance before getting to the year's highs around 111.65.

USDJPY, D1 interval, Source : xStation5

Réda Aboutika, XTB France