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USD/JPY has stabilized and is narrowing its trading range after a drop at the beginning of the last week and has formed a Triangle pattern on the 1H chart. The pattern has 75% quality and 57% magnitude in the 75-bar period.
The pattern started when the pair rebounded from 79.987 and after testing pattern's resistance levels at 79.310 and 79.591 it slowed down at 79.785 where the pair is currently trading. Pattern's support and resistance lines are set to intersect on the 5th of July, 11:00 GMT, at the level of 79.865. Technical indicators on aggregate suggest a bullish market outbreak on the 1 day outlook. The SWFX market sentiment, with 70% of traders at the buy side, points at a bullish market development in the neat future as well. Long traders should pay attention to today's peak at 79.861. If the pair develops beyond this level the next targets could be set at the pattern's support band at around 79.880 and the pattern's recent resistance test level at 79.928.
Short traders expecting negative fundamental news from the US after the national holidays could focus at the four hour support level at 79.779(Fibonacci). If the pair breaches this level the next possible targets could be set at 4th of July low at 79.694 and the patterns recent support test level at 79.591.
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