FX.co ★ remington.kihn | USD/JPY

Consolidation in the Resistance Area, Wait for Breakout Confirmation

Using the USD/JPY H1 timeframe chart, the last price was seen around 157,48 and is moving in a consolidation phase after previously experiencing a fairly strong rise. The price structure in general still shows a bullish bias because price is above the red moving average line, while the blue moving average is far below price and is still trending up. However, short-term momentum appears to be slowing as the last few candles have moved relatively sideways around the 157,40–157,60 area. The 157,60–157,70 area can be noted as the nearest resistance. If an H1 candle is able to break through and close convincingly above that area, a strategy to consider is looking for buy-on-breakout opportunities, with the next targets around 157,90 and then 158,20. A breakout should preferably be confirmed with a candle close, not just a wick or a momentary move. If price fails to hold that area and an H1 candle closes below it, the alternative scenario is to wait for a pullback for sell opportunities to reduce the risk of a false breakout. Conversely, the 157,30–157,40 area can act as short-term support. If price fails to hold that area and an H1 candle closes below it, the alternative scenario is to wait for a pullback for sell opportunities. Targets can be progressively directed toward 157,10 and then 156,80, as long as bearish pressure remains evident. For a more conservative strategy, avoid opening positions when price is still stuck in the middle of the 157,40–157,60 range because the risk-to-reward ratio tends to be less attractive. Wait for price to approach support or resistance, then use price action confirmation before entering a position. Risk management remains a core part of the strategy. Stop-loss should preferably be placed outside the setup invalidation level, not too close to the entry price. Position size should be adjusted so that the maximum loss per trade remains limited. Also pay attention to USD/JPY volatility because sharp moves can appear when there are Japanese or United States economic news. This analysis is based only on the H1 chart view in the image and is not a guarantee of the next price direction.