Here is what I see...

Look at the hourly chart below. What do you see?

  • I see choppy up and down trading with no discernible trend. Ok off to a bad start..Is there more?
  • I have the standard 100 and 200 hour MAs in the chart. Honestly, there are some instances where the MA was tested and held (just follow the lines) but more times there are failed breaks. This is congruent with the choppy, non- trending market conditions. Note, however, the price approached the 200 hour MA today and held. That is bullish. Store that as a clue. That cannot be ignored.
  • I have added a few up and downward sloping trend lines. At the extremes there was a test of the high trend line on Thursday and that attracted sellers - store that as it is recent. That is bearish. It is also a level that if the price is going higher, the price will need to get and stay above that level. The lowest trend line has just the last two lows. Looking at the inner trend lines, the lower line connects lows from last week. The higher one had three points on it. The price moved above the line in the Thursday volatility. Friday the line slashed through the price action and the market traded above and below the line. Today the line held support against the old line - store that. That is bullish. It also happened to be where the 200 hour MA was today. So two reasons for traders to buy near that line.
  • I have added some horizontal "remembered lines". I call them remembered lines because the market remembers those levels and seems to lean against them on some extremes. There is the double top at 114.26. At 113.98 there area a few peaks including today - store that. It is bearish. The 113.37 has a swing low and swing high from Feb 17 and Feb 22. There was some lows near the level most recently on Friday. Finally down at 112.15. The low last week extended to 112.217 - close enough.
  • The midpoint from the Feb 24 low is 112.79.

A hodge podge of levels.

Eventually, the market will break and run. Often there is a technical clue or two or three that shows the way. This is because the price action cannot hide buyers or sellers. Price actoin does not lie. Tools help those traders who start the process to lean and push. If many traders can see that level, it helps to attract a crowd before and after. For example if the 200 hour MA and broken trend line end up being the low, traders will start talking about how that level held and pushed the price higher. I know I see it, and will.

For example. for today, the old trend line and the 200 hour MA come together. Support held there. If the price was going to base that would be an area to base from.

Others might see the 113.98 level as a reason to sell. Yes, the price has traded above that 114.00 level last week and the week before but it goes above and comes back down.

We really don't know from what we see which way it will go. But we can lean. When we lean we can define and limit our risk. We can also wait for the extremes and look for the outer breaks. Whatever you do, understand that what you do is largely a guess. However, if you define your risk, and you lean against a level you see others leaning against (like 113.468 area), you are taking a calculated guess. In this market environment for this pair, that is the best you can do.

Eventually something will happen. The levels I see (and you see too) will be broken. There will be momentum. Traders today sold against 114.00 and they then bought against the 113.468 area. They are both winners now. Who will win the big trend break we don't know just yet, but at those levels traders placed their bets - at least in trading today. We will see now wait and see, how the cards are played.

PS Bank of Japan in the new trading day. So traders will be on alert for a break. Between now and then, you can still trade the levels.