USDJPY Goes Down Ahead of the US Elections

By Tomasz Wisniewski|

Published: November 08 2022, 15:07 GMT+0

USDJPY Goes Down Ahead of the US Elections

The European session was a bit sleepy but as we get closer to the US election’s results we’re getting more and more volatility.

USD seems to have lost it and stocks are pushing higher. That scenario was widely predicted for a Republican win, lets see if that will end up being the case.

In today’s piece: USDJPY, which is currently escaping from a nice pennant formation (blue lines) that started forming slightly after the intervention from the Bank of Japan. The pennant is a trend continuation pattern and was formed after a drop, so it was predicting this kind of a move as well.

In case sellers are able to close an H4 candle below the lower line of the flag, the sell signal would be triggered. Potential targets for this would be firstly the horizontal support on the 145 (orange), which was a crucial resistance in September and secondly the long-term up trendline (black). I think that the first target (145) looks so strong that this can actually be the first and last target for the sellers.

Of course, these are just technical takes. We’re about to deal with a great fundamental event, which can trigger a move of hundreds of pips. Overall, the main sentiment remains bullish and that would be threatened by the price breaking the black up trendline and later the green resistance. However, chances for that happening are now very limited.