The USD/JPY pair is trading below its downward trend line on a 4 hour time frame. This confirms that the trend is skewed towards the downside and as long as we remain below this trend line, the bias may remain for further downside move.
The price has pierced the Bollinger band, as shown in the chart below and this confirms that the volatility is high. The piercing of the Bollinger band does has a significant importance amid traders, as they do deem this is as an opportunity to buy or sell. The significance of the piercing of the Bollinger band is even higher when this takes place at an important level of support or resistance. Under the circumstances, this is taking place at a minor support zone (mentioned below) and hence we could potentially bounce from here.
The reading for the Bollinger the upper and lower bands are 1.0731 and 1.0961 respectively.
The RSI is trading at 32.94 which is in oversold territory and this may push the price higher or trigger a pause for the current price action.
by Naeem Aslam