Karen Jones, analyst at Commerzbank, notes that the USD/JPY pair recovered after being sold off towards the base of the cloud at 112.16 and further support is seen along the 8 month support line at 111.93.
“This may hold the initial test BUT the sell off is looking directional and failure here would target the 110.59/109.77 200 day moving average and August low. If the 109.77 August low were to give way, the June 8 low at 109.20 would be in focus.”
“Failure there would imply a slide back to the 108.12 May 29 low and the midFebruary high at 107.91. Minor resistance comes in along the 55 day ma at 113.07.”
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