By: Dima Chernovolov
USD/JPY continues to fall inside the clear Falling Wedge chart pattern which was previously identified by Autochartist on the 30-minute charts. Autochartist rates the Quality of this Falling Wedge at the 3-bar level – which reflects the slow Initial Trend and Uniformity (rated at the 1 and 2 bar levels respectively) and significant Clarity (7 bars). USD/JPY is expected to fall further inside this chart pattern – continuing the active sharp downward correction from the resistance zone described below.
As can be seen from the daily USD/JPY chart below, this Falling Wedge is continuing the sharp daily downward correction from resistance zone lying between the key resistance level 114.40 (monthly high from May), upper daily Bollinger Band and the 61.8% Fibonacci correction of the previous downward ABC correction from December. The proximity of the resistance zone adds to the probability USD/JPY will continue to decline inside this Falling Wedge.
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