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USD/JPY Price Analysis: Bounces off weekly lows, further upside above 140.00

  • USD/JPY rallies following soft Canadian jobs data and surge in US Treasury bond yields.
  • Bullish engulfing candlestick pattern forms a base for potential upside.
  • Technical indicators suggest buying momentum as USD/JPY challenges the 140.00 resistance level.

USD/JPY bounced off weekly lows, and the 20-day Exponential Moving Average (EMA) confluence on Friday after soft jobs data from Canada spurred a jump in US Treasury bond yields. The USD/JPY is trading at 139.37, up 0.32%.

USD/JPY Price Analysis: Technical outlook

After rallying toward new year-to-date (YTD) highs of 140.91 towards the end of May, the USD/JPY dipped towards 138.40, as threats of a possible intervention by Japanese authorities triggered four consecutive days of losses. Amidst those plays, US Treasury bond yields, edging lower, added another reason to the downturn. Since then, a bullish engulfing candlestick pattern formed, creating a base at around the 138.40s area, which was tested on Thursday, but sellers failing to crack below the 20-day EMA at 138.69, kept support intact, as buyers get ready for an assault toward 140.00.

Another factor that supports the USD/JPY moving upwards is the Relative Strength Index (RSI) indicator, which sits in bullish territory, while the three-day Rate of Change (RoC) suggests buyers gathering momentum as the RoC approaches neutral levels.

Therefore, USD/JPY's first resistance would be 140.00. A breach of the latter will expose the weekly high at 140.45, ahead of challenging the YTD high at 140.91. On the other hand, a dip below 139.00 could open the door to test the bottom of the abovementioned range at around 138.40.

USD/JPY Price Action – Daily chart

USD/JPY Daily chart

USD/JPY

Overview
Today last price139.3
Today Daily Change0.38
Today Daily Change %0.27
Today daily open138.92
 
Trends
Daily SMA20138.83
Daily SMA50135.92
Daily SMA100134.4
Daily SMA200137.3
 
Levels
Previous Daily High140.23
Previous Daily Low138.81
Previous Weekly High140.93
Previous Weekly Low138.43
Previous Monthly High140.93
Previous Monthly Low133.5
Daily Fibonacci 38.2%139.35
Daily Fibonacci 61.8%139.69
Daily Pivot Point S1138.41
Daily Pivot Point S2137.9
Daily Pivot Point S3136.99
Daily Pivot Point R1139.83
Daily Pivot Point R2140.74
Daily Pivot Point R3141.25

Author

Christian Borjon Valencia

Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.

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