Market Overview for POL/Yen (POLJPY)

• Price surged to 26.39 before retreating to 25.96 amid mixed momentum.
• High volatility observed near 26.12–26.39, with several engulfing and reversal patterns.
• Volume spiked during sharp declines in late ET hours, indicating aggressive selling pressure.
• RSI signaled overbought conditions early and oversold near the close, hinting at exhaustion.

POL/Yen (POLJPY) opened at 25.94 on 2025-11-05 at 12:00 ET, hit a high of 26.39, dipped to a low of 25.54, and closed at 25.54 by 12:00 ET on 2025-11-06. The 24-hour period saw a total volume of 158,540.1 and a turnover of approximately 4,034,519.6 Yen.

Structure & Formations

Price action during the 24-hour span displayed a volatile profile with several notable candlestick patterns. A bearish engulfing pattern occurred at 19:00 ET, following a bullish impulse, signaling potential reversal. A doji appeared at 23:30 ET, suggesting indecision at higher levels. Key support levels emerged around 25.90–25.95, which held during a sharp drop in the early hours of 12:00 ET. Resistance was clearly seen at 26.12–26.39, where price multiple times reversed on high volume.

Moving Averages

On the 15-minute chart, the 20-period moving average (SMA 20) crossed below the 50-period SMA (SMA 50), indicating bearish momentum in the last 6 hours. On the daily chart, the 50 SMA appears to act as a dynamic resistance at ~26.10, while the 200 SMA at ~25.50 has become a key support zone, coinciding with the recent low.

MACD & RSI

MACD showed a bearish crossover in the late ET hours, with the histogram contracting as price dropped to 25.96. RSI hit overbought territory above 70 in the early ET morning before dropping below 30 near the 24-hour close, signaling possible exhaustion on both the upside and downside. Momentum appears to be rotating from bullish to bearish, with mixed divergences in the late hours.

Bollinger Bands

Volatility expanded significantly during the 24-hour window, with price frequently touching the upper and lower bands. A contraction in the Bollinger Band width occurred at 01:00–01:15 ET, indicating a potential breakout, which was followed by a sharp drop. Price currently sits near the lower band, suggesting potential for a rebound or continuation of the downward trend.

Volume & Turnover

Volume surged during sharp price declines in the late ET and early local time hours, notably at 00:30 ET and 01:15 ET. A divergence between price and volume was observed around 00:15 ET, where volume spiked despite a relatively small price move, hinting at potential accumulation or distribution. Turnover confirmed aggressive selling during these periods, with the largest single-volume bar at 1815.7 at 20:30 ET.

Fibonacci Retracements

On the 15-minute chart, a retracement from the 26.39 high to 25.96 low showed a 61.8% retracement level at ~26.06, which held as support during a pullback. On the daily swing, a 38.2% level at ~25.95 and a 61.8% level at ~25.73 appear to have been tested in the final hours, with the price finding support near 25.95. These levels may offer potential for retests or continuation patterns.

Backtest Hypothesis

The proposed strategy involves identifying a bearish engulfing pattern after January 1, 2022, with a short entry at the next open and a fixed three-day hold period. While several bearish engulfing patterns were observed on the 15-minute chart, including at 19:00 ET and 21:15 ET, the strategy’s effectiveness will depend on the precision of the pattern’s identification and the market’s reaction to the subsequent three-day period. The current setup may align with the strategy if the market reacts to the 26.10–26.12 resistance zone with a clear bearish breakout.