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USD/JPY Technical Analysis: Yen Sinks to Lowest in 6 Years

USD/JPY Technical Analysis: Yen Sinks to Lowest in 6 Years

2014-09-09 01:46:00
Ilya Spivak, Sr. Currency Strategist
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Talking Points:

  • USD/JPY Technical Strategy: Flat
  • Support: 105.77, 105.43, 104.87
  • Resistance: 106.44, 106.99, 107.54

The US Dollar surged to a six-year high against the Japanese Yen, with prices securing a foothold above the 106.00 figure. Near-term resistance is at 106.44, the 38.2% Fibonacci expansion, with a break above that on a daily closing basis exposing the 50% level at 106.99. Alternatively, a reversal below the 23.6% Fib at 105.77 opens the door for a challenge of the January swing high at 105.43, followed by a rising trend line at 104.87.

Negative RSI divergence warns of ebbing bullish momentum and argues against entering long. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. With that in mind, we will remain on the sidelines for the time being.

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USD/JPY Technical Analysis: Yen Sinks to Lowest in 6 Years

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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