USD/JPY technical analysis: Holds steady above mid-108.00s, awaits fresh catalyst
|- The pair showed some resilience below 50% Fibo. level.
- Set-up support prospects for some dip-buying interest.
The USD/JPY pair stalled its recent pullback from the vicinity of the 109.00 handle, or 2-1/2 month tops, and managed to regain some positive traction on the first day of a new trading week.
The pair showed some resilience below 50% Fibonacci level of the 112.40-104.45 downfall, which is closely followed by a five-month-old descending trend-line resistance breakpoint near the 108.00 mark.
Given that the pair's recent failure just ahead of the very important 200-day SMA, weakness below the mentioned handle is likely to accelerate the slide further towards the 107.55 confluence support.
The latter comprises of 100-day SMA and 38.2% Fibo. level, which if broken decisively might negate any near-term bullish bias and set the stage for a further near-term depreciating move.
Meanwhile, technical indicators on hourly/daily charts have been drifting lower but remained well within the bullish territory, supporting prospects for the emergence of some dip-buying interest.
Hence, it will be prudent to wait for a sustained breakthrough the said confluence support before traders again start positioning for the resumption of the pair's prior well-established bearish trend.
On the flip side, any attempted positive move might continue to confront some fresh supply near the 109.00 handle (200-DMA), which if cleared now seems to pave the way for additional near-term gains.
USD/JPY daily chart
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.