trading idea on USDJPY, bounding on a supportive area, with the potential of breaking down.

• 2019-06-17
• Traiding Idea

As you probably know for the last 3 years USDJPY was under pressure inside a symmetric triangle. During this time it bounced couple of times between upper side and lower side of the triangle and everytime moved couple of hundreds pips. Recently it seems breaking below the lower side for the first time in the last 3 years. It can be a significant sign for a massive downward movement as chart is finally coming out of the compression zone.

Fundamentally trade war between US and China and recently adding tariff to Mexican imports caused a lot of pressure on the dollar shoulder. On the other side weakness of Euro and GBP creates a good opportunity for Yen to become the top gainer in the past few weeks. All of these things bring USDJPY down to the important area you see on the picture. In just a few days we have FOMC meeting on 19th of Jun, they will decide whether to cut interest rate or not. This can potantelly be the last push USDJPY needs to break this supportive zone and fall down.

The other scenario is if this break out will become a fake breakout then market will get energy to start another bullish rally however I don't put more weight on this scenario.