USD/JPY extended higher to hit a 5-month peak of 107.95 in early Monday trading. The break above the key psychological level of 107.00 and above the 200-day moving average today strengthens the bullish bias.
The next target to the upside is at 108.75. This level is defined as the 78.6% Fibonacci retracement level of the May to June fall from 111.44 to 98.96. Above this, the key 111.00 level comes into view and from this level prices would target the May 30 high of 111.44.
To the downside, there is immediate support at the 61.8 Fibonacci at 106.64. below this, the 200-day moving average is a strong support level around 106.44. Below this, Friday’s low of 106.02 is another support level.
If USDJPY remains above 105.00, which is close to the 50% Fibonacci level, the bullish structure will likely remain intact in the short term.
However, there should be some caution as the market is looking overextended now. The daily RSI has reached overbought levels at 70.
Interested in USDJPY technicals? Check out the key levels
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