Forex Strategy - USD/JPY Lacking Follow-Through Post Piercing Line
- USD/JPY Technical Strategy: Longs preferred
- Piercing Line formation seeing little follow-through
- 101.20 remains key support in intraday trade
USD/JPYcontinues to be well-supported at the 101.20 mark yet the bullish reversal hinted at by the Piercing Line formation on the daily has seen little upside follow-through. While this creates some doubt about a retracement towards 102.70 longs remain preferred until support is broken.
USD/JPY: Piercing Line Lacking Follow-through
Daily Chart - Created Using FXCM Marketscope 2.0
The warning of an intraday dip for USD/JPY post the Hanging Man formation noted yesterday materialized in a decline towards 101.20. However, with strong buying support evident an upside bounce to the psychologically-significant 102.00 level looks possible in the session ahead.
USD/JPY: Support Sustained At 101.20
Four Hour Chart - Created Using FXCM Marketscope 2.0
It should be noted that the upcoming FOMC March meeting offers substantial fundamental event risk for the US Dollar. The price action resulting from the decision may negate technical signals offered. Traders can watch live coverage of the event in the DailyFX Plus area of the site.
By David de Ferranti, Market Analyst, FXCM
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.