USD/JPY Technical Analysis: Attempting to Buck the Downtrend
- USD/JPY trying to break downtrend from June
- A run towards the 200-day over 10800 may be in the works
USD/JPY is working on another leg higher after a pullback following the verbal intervention that spurred it off multi-month lows to end July. It is currently trading above the top-side trend-line of a clean set of parallels, and if the rally holds it will have attention focused on the 10800 area.
A rise to that point may be all that is in store for now as there is a good deal of resistance in that vicinity. There are several turning points surrounding 10800 (+/- 30 pips) since November, as well as the 200-day at 10813 and a channel line coming off the February high.
At that juncture it appears likely, given the way USD/JPY has been trading, that we would see a meaningful reaction lower. Should we see failure in today’s rally, then it could result in a head fake breakout that sees that reaction begin much sooner and at lower levels. If this turns out to be the case, then look for the June-current trend try and reassert itself on a break back below 10600.
USD/JPY Daily Chart (run towards 10800 coming?)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.