During the last week the USD/JPY pair continued to
climb up and topped at 110.91. Today the pair is seen even higher and marked an
intraday high at 111. 33, a level that has not been
visited since late May. In the short term the downward movement seems to be limited, as
100-day and 200-day simple moving averages remain
well below the current
level.
As it is clearly seen on the H4 the technical indicators are placed at extreme
overbought area. RSI is starting some correction from the overbought area,
while stochastic is showing lack of momentum.
The bias remains bullish for testing
111.50. A clear break and daily close above this level could trigger further
upside pressure towards 113.50 this week. The nearest support is located at 110.35. A possible break below that area could lead the pair to neutral
trading levels with testing 109.80, but still the bulls possess the short term development for the upcoming days.
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