USDJPY – break above 55SMA to trigger stronger recovery

Slobodan Drvenica Windsor Brokers

USDJPY

The USDJPY pair is consolidating within daily cloud and holding above broken Kijun-sen (111.23) which now acts as good support.

Immediate downside risk has been sidelined after Thursday’s bounce from fresh three-week low at 110.23 that left long-tailed bullish daily candle (positive signal).

However, recovery stays capped by 55SMA (111.74) for the second day, which, together with 111.80 (Fibo 38.2% of 114.36/110.22) marks pivotal barrier.

Firm break here would trigger stronger correction of the downleg from 114.36 towards next barriers at 112.26 (20SMA) and 112.75 (100SMA / Fibo 61.8% retracement.

Daily studies are in mixed setup but slow stochastic is emerging from oversold territory and may lend fresh support to the pair for further advance.

Alternative scenario sees increased downside risk on return and close below daily Kijun-sen / cloud base (111.23/12).

Res: 110.74; 112.00; 112.26; 112.75
Sup: 111.23; 111.12; 110.50; 110.23

Interested in USDJPY technicals? Check out the key levels

1. R3 113.58
2. R2 112.66
3. R1 112.07
PP 111.16
1. S1 110.57
2. S2 109.65
3. S3 109.06

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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