Japanese Yen, USD/JPY, US Dollar, CHF/JPY, Swiss Franc – Talking Points

  • USD/JPY is eyeing off the 24-year high, but obstacles remain in play
  • CHF/JPY is caught in a range, but momentum might be gaining for a breakout
  • If the Yen weakening trend continues, how high can USD/JPY and CHF/JPY go?


USD/JPY has broken above a descending trend line and is above a series of Simple Moving Averages (SMA). This might suggest that bullish momentum is evolving and a move toward as the 24-year high made last month may unfold.

That peak of 139.39 could offer resistance. Ahead of it, the 78.6% Fibonacci Retracement of the move from 139.39 to 130.39 is at 137.46. That level coincides with a high made near the end of July and might offer resistance.

On the downside, a break point at 135.57 currently has the 34-day SMA nearby and it may provide support. The 55-day SMA also lies just below this level, presently at 135.39.

Further down, a cluster of break points and previous lows in the 131.25 – 131.75 area might provide a support zone.


Chart created in TradingView


CHF/JPY has traded in a 137.17 – 143.75 range for two-months and those levels may provide support and resistance respectively.

At the end of last week, it crossed above the July peak of 143.11 and appears set to test the seven-year high of 143.75 with bullish momentum potentially emerging.

A bullish triple moving average (TMA) formation requires the price to be above the short term Simple Moving Average (SMA), the latter to be above the medium term SMA and the medium term SMA to be above the long term SMA. All SMAs also need to have a positive gradient.

Looking at the 10-, 55- and 100-day SMAs, the criteria for CHF/JPY bullish TMA have been met.

The recent low of 140.40 is just above the 55-day SMA and might provide support.

An ascending trend line extending from the mid-May low of 127.51 and through the low of 137.17 from earlier this month could provide support, currently at 139.60.

Further down, the break point at 137.80 is a possible support level ahead of the 100-day SMA, currently dissecting at 136.94.


Chart created in TradingView

— Written by Daniel McCarthy, Strategist for DailyFX.com

To contact Daniel, use the comments section below or @DanMcCathyFX on Twitter

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