USD/JPY Technical Analysis:Support Sub-121.00 Challenged
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- USD/JPY Technical Strategy: Flat
- Support: 119.66, 118.93, 118.20
- Resistance: 120.68, 121.41, 122.13
The US Dollar continued to move higher against the Japanese Yen as expected after taking out the top of a Flag chart pattern. A daily close above the 38.2% Fibonacci expansion at 120.68 exposes the 50% level at 121.41. Alternatively, a reversal below 119.66 (38.2% Fib retracement, channel top resistance-turned-support) opens the door for a challenge of the 50% retracement at 118.93.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com