USD/JPY: The dollar bulls are hanging on [Video]
|USD/JPY
There are conflicting signals that are leaving Dollar/Yen at an important inflection point (this seems to be a theme across major pairs right now). Dollar/Yen is again trading around 106.00. This is the bottom of the pivot band 106/107 which is the overhead supply of all the old lows between April and July. The bull failure last week which left a high of 106.20 looked to be the point at which the dollar bulls would throw in the towel of recovery, but they stood strong yesterday (to forma small positive candle) and are again there today to test 106.00 again. Momentum indicators retain their negative bias for a medium term perspective (under neutral points on RSI and MACD), but the near term outlook is ticking slightly higher (positive cross threatening on Stochastics). It leaves the market on a knife edge. We are still minded that the weight of resistance between 106/107 is still likely to generate another lower high in that area and we look to sell into strength. However, for now the dollar bulls are hanging on. This may continue through to Fed Chair Powell’s speech on Thursday. Initial support is at 105.40 which protects 105.10 now. Above 106.20 opens 107.00.
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