U/J: approaching a key S/R level by Mary McNamara

The U/J has paused below a major S/R level ahead of Friday’s key NFP data. This S/R level is the 61.8% fib of the 2007-2012 bear move at the 105.5 region. 61.8% fib levels are key turning point levels on trading instruments and this is making the U/J very interesting at the moment; from a technical perspective that is.

U/J monthly: the monthly chart shows how the U/J tested this level back in Dec 2013 but didn’t manage to break and hold above this resistance. Any new break and hold above this 105.5 region would support the developing bullish Cup ‘n’ Handle pattern:

UJmonthly

U/J weekly: the bullish breakout from the weekly triangle pattern has now delivered up to 280 pips!

UJweekly

U/J daily: the triangle breakout is clear from the daily chart too:

UJdaily

U/J 4 hr: part of this 280 pip weekly triangle move has been made up of the more recent Bull Flag breakout on the 4hr chart. This recent Bull Flag move is currently up 120 pips:

UJ4

Summary: the U/J has had a bullish few weeks but the rally seems to have paused under the major resistance level of 105.5 (the 61.8% fib) ahead of NFP. Traders need to watch this level following NFP for:

  • A close and hold above 105.5 that would suggest bullish continuation.
  • A failure to close above 105.5 that would be less clear and present a situation of either possible further consolidation or retreat.

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