Bearish Reversal Likely for JP225?

• 11 Nov 2020

USD/JPY

USD/JPY looks like it could be entering into an evening star doji pattern which is generally bearish. A hanging man candle in yesterday’s trading followed by bearish momentum early in the Asian session suggests the current long-term downtrend will remain intact. Momentum indicators are mixed.

 

 

 

 

 

 

EUR/USD

The Eurodollar bounced back from the 1.192 resistance line. The retracement has resulted in a series of doji candles mid-range, which suggests bearish momentum is weak and that the 1.190 resistance area represent a psychological level for the pair. Momentum indicators have flattened in neutral/bullish territory. 

 

 

 

 

 

GBP/USD

GBP/USD buyers are driving price action which is moving towards the 1.338 ceiling. On a previous occasion, the Pound has rejected this price area. Further, fundamentals do not support significant Pound strength and the gains are likely only due to recent moves from the BoE. Momentum indicators are bullish.  

 

 

 

 

GOLD

Gold buyers are building moderate momentum which is taking price action back towards the upper trendline of a descending triangle. If price action is contained within this triangle, we may expect the downtrend to continue. Momentum indicators have stalled in the neutral zone. 

 

 

 

 

 

OIL

WTI has bounced back from the 34.04 support level and spiked through the $40 per barrel range, touching the 41.69 resistance level before retracing back to the $39 per barrel level. It seems unlikely that the commodity will break out of this range in the near-term. Momentum indicators have upward trajectories.

 

 

 

 

ASX200

The Australian index spiked through the 6480 resistance area, yet price action was continued within the 6400 range. An evening star doji appears to be forming and will be confirmed if today’s trading session closes lower. A doji/hanging man in yesterday’s trading indicates buyers may be losing conviction. Momentum indicators remain in bullish territory, with RSI indicating the index is overbought. 

 

 

 

 

JP225

JP225 buyers continue to test the 25,366 resistance area as bullish pressure persists. The most recent bullish move comes after a long period of consolidation with fundamentals not supporting strength in the index. Current optimism therefore seems likely to fade. Momentum indicators are bullish with a momentum reversal beginning in RSI.