USD/JPY Technical Analysis: Trying to Clear Path Sub-116.00
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- USD/JPY Technical Strategy: Flat
- Support: 117.34, 115.48, 113.51
- Resistance: 119.41, 120.39, 121.84
The US Dollar turned lower against Japanese Yenas expected after putting in a bearish Three Inside Down candlestick pattern. A daily close below the 117.34-91 area marked by the November 21 low and the 23.6% Fibonacci retracement exposes the 38.2% level at 115.48. Alternatively, a reversal above the 14.6% Fib at 119.41 clears the way for a test of trend line support-turned-resistance at 120.39.
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
--- 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.