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USD/JPY: Recovery stalls at hourly 10-SMA

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 8, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The extended USD/JPY three-day decline took a pause near 119.60 levels and attempts a weak recovery towards the hourly 10-SMA.

    USD/JPY trades below hourly 200-SMA

    Currently, the USD/JPY pair trades -0.20% at 119.78, bouncing-off lows at 119.63. The USD/JPY pair trimmed losses and tries to recover the lost ground somewhat while the European stocks continue to wobble ahead of the BOE and ECB minutes due for release this session.

    The major faces strong resistance to regain the 120 handle as the European traders remain nervous and prefer to park their funds in safe-havens such as the yen ahead of the BOE and ECB minutes, which may spur volatility across the FX board.

    Looking ahead, the FOMC minutes which will be published after the close of European markets will set the tone for a clear direction on USD/JPY.

    USD/JPY Technical levels to consider

    To the upside, the next resistance is located at 119.99 (10-DMA) beyond which 120.13 (20-DMA) could be tested. A breach of the last, the pair could climb further towards 120.56-57 (Oct 5 & 6 Highs). To the downside immediate support might be located at 119.22-21 (Sept 29 & 24 Lows), below which 118.83 (Sept 8 Low) could be exposed. A breach of the last, the pair could drop to 118.67/65 (Oct 2 & Sept 7 Lows) levels.
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