USD/JPY: correcting lower, beware of 111.25
USD/JPY Current price: 111.36
The USD/JPY pair consolidated its Monday's gains during the first half of the day, now retreating from a daily high of 111.78, although lacking clear directional strength this Tuesday. Equities were mixed in Asia, with the Nikkei sharply higher following their overseas counterparts, but the Hang Seng down almost three digits, while European ones hover around their opening levels, struggling for direction. The USD/JPY pair continues tracking yields for direction, currently around late Monday's levels, therefore failing to provide clues to JPY traders.
The pair seems poised to correct lower in the short term, moreover as dollar's demand receded. In the 4 hours chart, the price is hovering around a modestly bearish 100 SMA, whilst the RSI indicator retreats from overbought readings, currently at 62, whilst the Momentum also heads lower within positive territory, now nearing its 100 level. The pair has an immediate support at 111.25, the 50% retracement of its April/May rally, with a break below it exposing the 110.50 price zone. To the upside, 112.00 is key as only beyond it the pair can gain bullish traction.
Support levels: 111.24 110.85 110.50
Resistance levels: 111.60 112.00 112.45
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.
