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USD/JPY finds good support near 121.20

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 1, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The USD/JPY pair is seen
    consolidating in a 20-pips range since mid-Asia, unable to break through the stiff resistance placed near the mid-point of 121 handle, where the 200-DMA coincides.

    USD/JPY struggles below 200-DMA

    The USD/JPY pair finds fresh bids on its every attempt to the downside near 121.20 levels and swings back higher towards 121.40 region as the rallying Japanese stocks continue to cushion the downside in the major. Japan’s Nikkei 225 index is continuing its post-BOJ strong run and now jumps +2% towards closing hours.

    However, the major remains confined below the 200-DMA near 121.50 as the sentiment around the risk-currency US dollar remains dented in wake of the latest weak China manufacturing gauge and falling oil prices. The USD index trades marginally lower at 99.55.

    Focus now shifts towards a fresh batch of US economic data in the week ahead for further cues on the Fed’s rate hike outlook, especially after last week’s dataflow disappointed markets. The US ISM manufacturing PMI and core PCE price index will be closely watched later today.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 121.47/50 (200-DMA/ round number). A break above the last, the major could test 122.22 (Dec 11 High). While to the downside, the immediate support is located at 121 (psychological levels/ daily S2) below which 120.73 (100-DMA) would be tested.
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