USD/JPY Outlook: consolidation to precede fresh upside while converged 10/100DMA's hold dips
|USD/JPY
The pair remains in red in early Friday's trading and extends weakness on probe through pivotal supports at 107.95/91 (top of thick rising 4-hr cloud/converged 10/100DMA's). Thursday's bearish close (the first after 10 consecutive days in green) generated negative signal on formation of bearish engulfing pattern. Daily stochastic is heading south after formation of bearish divergence and reverse from overbought territory and fading bullish momentum add to negative signals. Fresh weakness needs break and close below 107.95/91 pivots to signal deeper pullback and expose next significant supports at 107.47 (16 Sep low) and 107.23 (55DMA). Failure to break lower would signal consolidation and keep existing bulls intact for renewed attempt towards upper pivot at 108.42 (50% retracement of 112.40/104.44).
Res: 108.08; 108.25; 108.47; 109.00
Sup: 107.76; 107.47; 107.23; 107.11
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