USD/JPY Technical Analysis: Yen Rallies Most in 3 Weeks
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- USD/JPY Technical Strategy: Flat
- Support: 117.91, 115.48, 113.51
- Resistance: 119.41, 120.82, 121.91
The US Dollar produced its largest decline in three weeks against the Japanese Yen, with prices breaking downward out of a consolidation range. A daily close above the December 23 highat 120.82 exposes the 38.2% Fibonacci expansionat 121.91. Alternatively, a turn below the 14.6% Fib retracement at 119.41 clears the way for a challenge of the 23.6% threshold at 117.91.
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