- Yellen's speech overnight was a balanced one, with something for both bulls and bears.
- USD/JPY holds firm, takes cloud support and regains 200-DMA at 112.07.
- Technical studies support upside in the pair, next resistance lies at 112.95 (78.6% Fib retrace of 114.49 to 107.31 fall), 113.90 (trendline).
- Breakout above will see further gains, scope then for test of 113.90 (major trendline).
- Traders await announcement of tax cut details after President Trump said that he will unveil a 35% Individual Tax Rate with an option to go higher.
Support levels - 112.14 (5-DMA), 112.07 (200-DMA), 111.55 (cloud top), 111.06 (100-DMA)
Resistance levels - 112.95 (78.6% Fib retrace of 114.49 to 107.31 fall), 113.90 (trendline), 114, 114.50 (July 11 high)
Recommendation: Good to go long on dips around 112.25, SL: 111.55, TP: 112.90/ 113/ 113.90.
FxWirePro Currency Strength Index: FxWirePro's Hourly USD Spot Index was at 86.4342(Slightly bullish), while Hourly JPY Spot Index was at 45.2317 (Neutral) at 0440 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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