USD/JPY Technical Analysis: Coiling Up at Channel Top
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- USD/JPY Technical Strategy: Flat
- Support: 119.66, 118.93, 118.20
- Resistance: 120.04, 120.68, 121.41
The US Dollar stalled at falling channel resistance capping gains over the past three weeks against the Japanese Yen. Near-term support is at 119.66, the 38.2% Fibonacci retracement, with a break below that on a daily closing basis exposing the 50% level at 118.93. Alternatively, a reversal above channel resistance at 120.04 clears the way for a test of the 38.2% Fib expansion at 120.68.
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.