- USD/JPY closed the initial bearish gap open to edge higher in the Asian session.
- But, upside failed at 112 handle, the pair has slipped lower to currently hover around 111.80 levels.
- Technical studies are bearish. Stochs have rolled over from overbought levels and RSI is biased lower. MACD is showing a bearish crossover.
- We also evidence a 'Bearish Cypher' pattern on daily charts which adds scope for downside.
- 200-DMA at 111.78 is offering strong support on the downside, break below will accentuate weakness.
- Scope then for test of 100-DMA at 111.12. Bearish invalidation seen on retrace above 20-DMA at 112.35.
Support levels - 111.50 (Sept 26 low), 111.12 (100-DMA), 111, 110.75 (50-DMA)
Resistance levels - 112, 112.15 (5-DMA), 112.72 (Sept 21 high)
Call update: Our previous call (https://www.econotimes.com/FxWirePro-Bearish-Cypher-pattern-raises-scope-for-downside-in-USD-JPY-bias-lower-stay-short-942286) has hit TP1/2.
Recommendation: Book partial profits at lows. Lower trailing stop to 112.10, hold for further weakness.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at -56.2144 (Neutral), while Hourly JPY Spot Index was at 46.8221 (Neutral) at 0840 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest
