By: Dima Chernovolov
USD/JPY continues to fall inside the daily Down Channel chart pattern, which was recently identified by Autochartist. Autochartist rates the quality of this Down Channel at the 5-bar level – which is the result of the medium Initial Trend, Uniformity and Clarity (all rated at the 5 bar level). USD/JPY is expected to fall further inside this Down Channel – in line with the earlier downward reversal from the resistance area shown below.
As can be seen from the daily USD/JPY chart below, the price earlier reversed down with the daily Evening Star from the resistance area lying between the resistance level 106.00, upper daily Bollinger Band and the 61.8% Fibonacci correction of the downward impulse from August. The proximity of this resistance area adds to the probability USD/JPY will continue to fall inside this Down Channel.