USD/JPY analysis: bullish momentum fading, but next direction not set yet

Valeria Bednarik FXStreet

USD/JPY Current price: 113.93

The USD/JPY pair closed the day a few pips below the 114.00 level, after topping in the 114.30 region for a third consecutive day. The pair found modest support in advancing equities at the beginning of the day, but as European equities entered the red, and yields pulled back from daily highs, the yen strengthened, ignoring US positive data, which usually results in a bullish move. US figures, however, were enough at least to prevent the pair from falling further, while the decline in US Treasury yields was quite shallow, as the 10-year note benchmark settled at 2.40%, down from previous 2.41% and after topping at 2.42% daily basis. Japan will release some minor figures during the upcoming Asian session, not enough to affect the pair, with attention therefore shifting to US CPI figures later on the day. Technically, the 4 hours chart shows that the Momentum indicator continued sliding towards its 100 level, reflecting limited buying interest, but the price continues developing above bullish 100 and 200 SMAs, whilst the RSI indicator turned north, now around 56.

Support levels: 113.60 113.20 112.75

Resistance levels: 114.15 114.50 114.90

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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