USD/JPY Price Analysis: Lacks direction between seven-week-old support and 50-DMA
|- USD/JPY treads water after reversing from one-month high.
- Bullish MACD signals, sustained trading beyond previous resistance lines keep buyers hopeful.
- 50-DMA breakout could refresh yearly top and convince buyers to keep the reins.
USD/JPY retreats from intraday high as sellers attack 131.00 during the early hours of Wednesday’s European session. However, the Yen pair remains unchanged on a daily basis, after posting the biggest daily loss on reversing from the 50-DMA hurdle the previous day. In doing so, the USD/JPY pair reversed from the one-month high but failed to conquer a horizontal support area comprising multiple levels marked since December 20, 2022.
Not only the quote’s ability to stay beyond the seven-week-old horizontal support, near 130.50 by the press time, but successful trading beyond the previous resistance line from late November 2022, close to 129.35 at the latest, also keeps the USD/JPY buyers hopeful. Adding strength to the upside bias are the bullish MACD signals.
As a result, the pair is likely to overcome the immediate 50-DMA hurdle surrounding 132.40, which in turn could propel the USD/JPY price towards the previous monthly high of 134.77.
In a case where the quote remains firmer past 134.77, the late 2022 peak surrounding 136.70 and the 140.00 psychological magnet will be crucial to watch.
Alternatively, a downside break of the aforementioned horizontal support near 130.50 will need validation from the 130.00 round figure and the resistance-turned-support line from November, near 129.35, to convince USD/JPY bears.
Following that, a south-run towards the previous monthly low of near 127.20 can’t be ruled out.
USD/JPY: Daily chart
Trend: Further upside expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.