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- USD/JPY Technical Strategy: Flat
- Support: 102.01 (23.6% Fib exp.), 101.52 (38.2% Fib exp.)
- Resistance: 102.30-37 (14.6% Fib exp., channel floor), 102.77 (June 4 high)
The US Dollar declined as expected against the Japanese Yen after prices produced a Bearish Engulfing candlestick pattern. Near-term support is now at 101.52the 38.2%Fibonacci expansion, with a break below that exposing the 50% level at 101.13. Resistance is at 102.01, the 23.6% Fib. A daily close above this barrier opens the door for a challenge of the 14.6% expansion at 102.30.
Risk/reward considerations argue against entering short with prices sitting just above support. On the other hand, taking up the long side is premature absent a defined bullish reversal signal. We will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0