Friday's nonfarm payroll showed positive data for the jobs market in November. Better-than-expected job creation numbers, and the lowest unemployment rate since December 2008 (7.7%) gave the US dollar a boost against its safe haven rival Japanese yen. Let’s take a look at the USD/JPY charts.
USD/JPY 4H Chart 12/4/2012 10:00PM EST
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Consolidation range: The pair has been consolidating in a range between 81.68 support and 82.82 resistance. You can say the central pivot is around 82.21. I mention the central pivot because recent price action tested this and respected it as support, showing bullish bias within the sideways market. The better-than-expected jobs data simply nudged the USD/JPY higher to test the range resistance at 82.82. A break above this level continues the bullish outlook that has the 2012-high of 84.19 in sight.
Momentum: A price breakout will likely be accompanied by the 4H RSI sustaining a break back above 60. This reflects persistent development of bullish momentum.
Failure: Failure to push through 82.82 and a dip below 82.20 should be seen as a failed bullish attempt, introducing the possibility of a triple top formation. The first focus will be the 81.68 range low, but if that is broken too, we have a complete triple top, and a signal of some downside correction ahead.
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