The markets have been quite slow in the passing weeks due to volatility drying up compeletly. This week’s trading was worse as the market paused in anticipation of the NFP release. The USDJPY daily chart has been a hostile trading environment as the market whips around inside of an unstable range.
Naturally, the NFP release brought a spike of volatility in the market, mostly creating uninteresting noise. The USDJPY however, printing a very large sell signal as the market rejected the market top. Firstly, price tried to breakout of the range top, but this move was heavily rejected as the yen quickly built up strength. Price aggressively collapsed down lower, closing below the open price for the day.
This is a very powerful sell signal that communicates a failed breakout and rejection of important resistance (the range top). Looking to take advantage of any retracements next week to grab a better entry price into the trade setup. Strong, decisive signals like this could kick off a strong move that could potentially see the breach of the range bottom.