The last release of
Japan’s economic growth showed weak figures and blurred the lines of Abenomics
reforms, and of course reduced the likelihood of tightening the BoJ’s monetary policy
in the near future. Technically speaking this weakness supported the US bulls who are
already gaining strength during the last sessions.
The USD/JPY today attacked the February’s high and currently is trading slightly
above the 200-day SMA at 110.36. As seen on the daily chart the price is
developing within the current bullish channel, that has started from late
March. RSI and stochastic are showing strong upward momentum and are close to
overbought areas. Meanwhile the pair is located fairly in middle of the
channel, so now we should consider both the upside and down side. Reversals would
be supported by the lower bound of the
channel, which currently comes at 109.40. On the other hand the more likely
scenario is bullish continuation towards the resistance at 110.40, which is
broken to above would open doors for testing the upper channel’s bound at
111.40.
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