USD/JPY continues to trade in a range, thus keeping a neutral bias for the short term. After rebounding from the 100 yen area on August 26, the pair rose to briefly peak above the 104 yen level. It reached a high of 104.31 on September 2. Since then, the market has pulled back and is now pivoting the 50% Fibonacci retracement level (102.20) of the recent August to September rise. The RSI is flat and hugging the 50 level, which suggests consolidation in the near term.
To the upside, prices are capped at the 50-day moving average at 102.70, which also happens to be the 38.2% Fibonacci level. Prices would need to rise above this resistance level and clear the key 103.00 level in order to see more upside momentum towards 103.40 and 104.00.
To the downside, immediate support lies at 101.70 (61.8% Fibonacci). A break below this would see prices target the 101.00 area and then the critical 100.00 level. A drop below this level would extend the longer-term downtrend that started at the end of December.
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