USD/JPY divergence analysis for January 24, 2013
After the USD/JPY rate has consolidated above the level of correction 161.8% – 88.53 of Fibonacci, the pair has rebounded to the level of correction 161.8% of Fibonacci. The rebound from this level enables continuation of growth towards the level of correction 200.0% – 91.16. Consolidation of the quotes under the level of correction 161.8% provides a possibility for the pair to drop towards the level of correction 100.0% – 84.16. No new divergences are observed at the moment. All the indicators are overbought at the moment. It increases the possibility of the pair to consolidate under the level of correction 161.8%. But the growth has been rather strong recently and there were no significant fluctuations in the rate except for a moderate drop.
After a bullish divergence was formed, the rate swung towards the U.S. dollar and rebounded to the correctional level of Fibonacci 685.4% – 89.49. A rebound from this level enables the pair to start falling towards the level of correction 523.6% – 86.61. The CCI indicator has formed a divergence: the recent price’s low is higher than the previous, but the recent low of the indicator is lower than the previous one. These facts were a prerequisite for the formation of a bullish divergence, which enabled rate’s growth. Consolidation above the level of Fibonacci 685.4% allows the pair to continue rising to the level of Fibonacci 200.0% on the daily chart. No new divergences were observed.
The material has been provided by Instaforex Company – instaforex.com