USD/JPY outlook: Bulls crack key barriers but overbought conditions warn

Slobodan Drvenica Windsor Brokers

USD/JPY

Bulls extend steep ascend and hit new highest levels since mid-July in early Thursday’s trading, cracking pivotal barriers at 107.15/23 (Fibo 50% of 111.71/102.59 / 100WMA).

This area is seen as a breakpoint and bulls will tighten grip on clear break higher that would bring in focus targets at 108.00/23 (round-figure / Fibo 61.8%), but overbought stochastic and RSI on daily chart and 14-d momentum in the sideways mode after strong ascend, warn that rally may run out of steam and take a breather before continuing.

Favor dip-buying above 106.20 zone (Feb 17 former high / rising 10 DMA) while break here would sideline bulls for deeper correction towards next key supports at 105.71 (20DMA) and 105.45 (200DMA / bull-trendline off 102.59 (Jan 6 low).

Res: 107.52; 108.00; 108.23; 108.50.
Sup: 106.94; 106.66; 106.20; 106.07.

Interested in USD/JPY technicals? Check out the key levels

1. R3 107.67
2. R2 107.41
3. R1 107.2
PP 106.94
1. S1 106.73
2. S2 106.47
3. S3 106.25

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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