The pair extended weakness to 111.81 on Thursday, as yen benefited from recent risk aversion, but probe through key supports at 111.96 (rising 55SMA / trendline support) were so far short-lived, despite magnetic daily cloud twist (111.47).
Subsequent bounce signals that bears might be running out of steam, as momentum heads up and partially offsetting negative impact from bearish MA’s / slow stochastic.
Today’s close would provide more clues, as current long-tailed Doji or hammer could signal reversal.
Recovery needs sustained break above 10SMA (112.32) to sideline downside risk and generate bullish signal for further retracement of 112.88/111.81 bear-leg.
Conversely, stronger bearish signal could be expected on close below 55SMA / bull-trendline, which would expose key supports at 111.64/62 (daily cloud top / 15 Oct low) and risk further weakness on break.
Res: 112.32, 112.64, 112.74, 112.85
Sup: 112.08, 111.96, 111.81, 111.62
