USDJPY outlook: Recovery looks for further signals to resume and neutralize existing downside risk
The dollar regained traction vs yen and keeping the pair in green on Monday, following Friday’s bullish engulfing that generated an initial signal of reversal of last week’s steep fall, boosted by Fed.
Today’s action, although being so far shaped in long-legged Doji, is holding above daily cloud top (107.21) and repeated daily close above the cloud would add to reversal signals.
Daily studies are mixed as MA’s remain in bearish configuration, stochastic is emerging from oversold territory while momentum is neutral, suggesting that fresh direction signals are needed.
The greenback remains resilient despite fresh fears about the second coronavirus wave that deflated risk mode, but despite positive signals, the downside is expected to remain vulnerable, as recovery remains capped by converged 30/55 DMA’s (107.54/60) which guard pivotal barriers at 107.82/87) Fibo 38.2% of 109.85/106.57 / 20DMA), break of which would accelerate recovery.
Res: 107.60; 107.87; 108.15; 108.41
Sup: 107.00; 106.57; 106.44; 105.98
Interested in USD/JPY technicals? Check out the key levelsR3108.74 R2108.15 R1107.77 PP107.18 S1106.8 S2106.21 S3105.83 Updated Jun 12, 00:00 GMT See Full Study
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