Using Fibonacci After USD/JPY Registers Fresh 2023 High in June
The Fibonacci sequence is a series of whole numbers where each figure is the sum of the two before it. It starts with zero and one, which are known as the 'seed numbers'. The next number is (0 + 1) one, followed by (1 + 1) two and so on.
Fibonacci ratios are a series of percentages calculated by dividing figures along the Fibonacci sequence. There are quite a few different ratios, but the key ones are 23.6%, 38.2%, 61.8%, 78.6% and 161.8%.
But how can you use Fibonacci theory in your trading? The most common way is through Fibonacci retracements, which traders use to predict support and resistance levels when a market retraces after a significant move.
Fibonacci Retracement: January low (127.23) to June high (145.07)
USD/JPY appears to be reversing course after registering a fresh yearly high (144.90) in June.
Recent price action makes it sensible to apply a Fibonacci retracement of the new yearly range as USD/JPY trades to a fresh monthly low (141.36) and the weakness may gather pace as the exchange rate extends the series of lower highs and lows from last week.
The first region of interest comes in around 140.86 (23.6% Fib) with a move below the 50-Day SMA (139.85) opening up 138.25 (38.2% Fib).
Keep in mind, the decline in USD/JPY may turn out to be temporary as the moving average continues to reflect a positive slope.
Fibonacci ratios are a series of percentages calculated by dividing figures along the Fibonacci sequence. There are quite a few different ratios, but the key ones are 23.6%, 38.2%, 61.8%, 78.6% and 161.8%.
But how can you use Fibonacci theory in your trading? The most common way is through Fibonacci retracements, which traders use to predict support and resistance levels when a market retraces after a significant move.
Fibonacci Retracement: January low (127.23) to June high (145.07)
USD/JPY appears to be reversing course after registering a fresh yearly high (144.90) in June.
Recent price action makes it sensible to apply a Fibonacci retracement of the new yearly range as USD/JPY trades to a fresh monthly low (141.36) and the weakness may gather pace as the exchange rate extends the series of lower highs and lows from last week.
The first region of interest comes in around 140.86 (23.6% Fib) with a move below the 50-Day SMA (139.85) opening up 138.25 (38.2% Fib).
Keep in mind, the decline in USD/JPY may turn out to be temporary as the moving average continues to reflect a positive slope.
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