USD/JPY outlook: Bulls tighten grip and look for retest of 2021 high

Slobodan Drvenica Windsor Brokers

USD/JPY

The USDJPY maintains firm tone and extends last Friday’s jump, looking for retest of 2021 high at 114.69, posted on Oct 20.

Repeated downside rejections at 113.40 zone (Fibo 23.6% of 109.11/114.69 rally) left a higher base after subsequent rebound signaled an end of shallow pullback.

Daily studies remain in full bullish setup and gain fresh positive momentum, while Friday’s bullish engulfing adds to positive signals.

The pair ended October with nearly 2.5% advance (the biggest monthly gain since March) marking the third straight month in green.

Bulls look for a firm break of cracked strong 114.60 resistance zone (Fibo 76.4% of 118.66/101.18 / 2017 peaks) to open way for extension through psychological 115 barrier and signal continuation of an uptrend from 102.59 (2021 low).

Converged 5/10DMA’s offer immediate support at 113.97, guarding more significant 113.40 higher base (reinforced by rising 20DMA), which needs to hold to keep bulls in play.

Res: 114.69; 115.00; 115.50; 116.00.
Sup: 113.97; 113.40; 113.00; 112.56.

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

1. R3 114.75
2. R2 114.42
3. R1 114.19
PP 113.86
1. S1 113.63
2. S2 113.31
3. S3 113.07

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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