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USD/JPY recovery meets fresh supply near 117.50

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 11, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - USD/JPY’s recovery from the lowest levels since Aug 2015 met fresh supply near the mid-point of 117 handle in the last hours, and from there the prices fell back in the red.

    USD/JPY supported above 117 handle

    Currently, the USD/JPY pair trades -0.13% lower at 117.28, unable to extend beyond 117.50 levels. The USD/JPY pair is seen consolidating sharp losses seen in the early Asian session, although remains capped below 117.50, with the yen bulls fighting back control on the back of the extension of losses in the Chinese equities. The Chinese benchmark, the Shanghai Composite (SSEC) index drops -3.39% while the Shenzhen’s CSI300 index sinks -3.36%, accelerating further to the downside.

    Meanwhile, the US dollar extends its upbeat momentum into a third-day today against its major competitors, with the DXY edging 0.07% higher at 98.51. Therefore, the downside in USD/JPY remains cushioned on the increased bids for the USD.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 117.58/62 (5 & 20-DMA). A break above the last, the major could test 118.31 (1h 100-SMA). While to the downside, the immediate support is located at 117 (round number) below which 116.76/70 (daily S1/ low) would be tested.
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