USD/JPY Technical Analysis: Yen Soars to One-Month High
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- USD/JPY Technical Strategy: Flat
- Support: 106.63, 105.57, 104.50
- Resistance: 107.95, 108.76, 110.08
The US Dollar tumbled to the lowest level in a month against the Japanese Yen, with sellers claiming a foothold below the 170.00 figure. A daily close below the 38.2% Fibonacci retracementat 106.63 exposes the 50% level at 105.57. Alternatively, a reversal above the 107.64-95 area marked by trend line resistance-turned-support set from May 2013 and the 23.6% Fib at 107.95 opens the door for a test of the 14.6% retracement at 108.76.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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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.