USDJPY Volatility Increased Below 104.50 Area – Bulls to Regain Momentum?


USDJPY has become volatile and corrective after bouncing from 103.70 to 103.80 support level. USDJPY volatility increased below 104.50 psychological event level. Bull to regain momentum in the coming days? What are the charts and technical indicators are saying? Read more to find further insights into today’s USD/JPY Technical Analysis. 

December 8, 2020, | AtoZ Markets – USDJPY is currently trading around 104.00 area and trying to push downside. The price broke below the dynamic level of 20 EMA on the intraday chart with a bearish engulfing candle. As per the current price action, USDJPY may face strong support around 103.80 to 103.70 area in the coming days.

Moreover, the U.S. consumer acquiring rose in October by not as much as an estimate, reflecting a decrease in credit card adjusts as the pandemic kept on restricting a few buys. Full credit expanded $7.2 billion from the earlier month after a downward reexamined $15 billion September makings; Federal Reserve figures demonstrated Monday. The middle inventory in a Bloomberg overview of financial experts required a $15.5 billion expansion in October. Rolling credit declined for the seventh time in the previous eight months.

On the other hand, Prime Minister Yoshihide Suga said on Tuesday, “Japan will gather a new 73.6 trillion yen ($708 billion) monetary improvement package to accelerate the nation’s recuperation from its profound Covid-19 slump.” Furthermore, Suga said in a meeting with governing party chiefs that the fresh package will incorporate around 40 trillion yen indirect monetary spending and initiatives focused at lessening carbon emanations and boosting digital innovations.

USDJPY Volatility Increased as the COVID-19 Cases Increased Around the Globe

USDJPY is currently residing near 104.00 area and trying to decline further. However, the price is still residing below the dynamic level of 20 EMA on the daily chart.

USDJPY Volatility Increased

Image: USDJPY 4 Hour Chart

According to the 4-hour chart, USDJPY volatility increased and currently trading around 104.00 area. As per the current price action, if the price pushes further down towards 103.80 to 103.70 support area and bounced upside, the bulls may regain momentum and recover higher towards 104.50 to 104.70 area in the process.

In addition, the dynamic level of 20 EMA is currently residing above the price. It may push the price down as strong resistance. However, the bulls may regain momentum if the price breaks above the dynamic level in the days ahead. Besides, the MACD histogram volume has created a bullish divergence. It indicates that bull may regain momentum for a while in the coming days.

USDJPY May Sustain the Bearish Trend

According to the daily chart, USDJPY volatility increased, but the bears are still optimistic. As per the current scenario, if the price pushes further downside and breaks below 103.80 to 103.70 support with an impulsive bearish candle, the bears may continue the bearish pressure towards 102.60 to 102.60 area in the day ahead.

USDJPY Volatility Increased

Image: USDJPY Daily Chart

Furthermore, the dynamic level of 20 EMA is currently residing above the price. Along with the Kijun line and the Tenkan line. So, the dynamic level may act as strong resistance to push the price downward. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the process.

To conclude, as long as the price residing below 104.70 to 104.50 resistance area, the bias will remain bearish. A daily close is required to identify the definite momentum in the coming days. 

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