The 200-point increase in the dollar-yen pair yesterday was as unexpected as it was not sustainable in the future. It was driven by the growth of stock markets due to news about the effectiveness of the American vaccine companies Pfizer and BioNTech against COVID-19 at the level of 90%. The Dow Jones stock index rose by 2.95%, the S&P 500 added 1.17%, but the growth was due to the gap from the opening of the market, the indices declined, but the gap was not closed, while the Nasdaq index closed the day with a fall of -1.53%. That is, the quality of growth in stock indexes was low, and a significant share of optimism about vaccines has long been embedded in quotes.
On the daily chart, the price overcame the resistance of the MACD line yesterday. The Marlin oscillator shot up, but this morning, the situation with the price and indicators is making an attempt to return to a downward trend. The price just needs to do a little bit to gain a foothold under the trend line below 104.78. This will be the initial condition for a reversal, and the target for further decline will be 104.05. Then 103.18, and the target 102.35 may open again. The reverse exit of the price above today's opening will open the prospect of further growth to the embedded line of the price channel at 106.06.
Meanwhile, the situation is completely upward on the four-hour chart. The price is above both indicator lines, and Marlin is in the zone of a growing trend.
Thus, the first condition for restoring the downward local trend of the pair will be the fixing of the price at 104.78. The confirming factor will be a decline at 105.04, which will coincide with overcoming the MACD line on the four-hour scale.The material has been provided by InstaForex Company - www.instaforex.com