USDJPY is in the process of recouping the previous week’s strong losses, standing near the 23.6% Fibonacci retracement level of the up leg from 102.60 to 111.65 at 109.50.
The RSI indicator is hovering in the negative region, while the MACD is stretching its bearish bias below its trigger and zero lines. In trend indicators, the 20- and 40-day simple moving averages (SMAs) are sloping downwards and the blue Kijun-sen line is travelling below the red Tenkan-sen line.
More gains could lead the market towards the immediate resistance levels such as the 20- and 40-day SMAs at 109.85 and 110.15 respectively, around the Ichimoku cloud. Even higher, the price could hit the 110.80 barrier before meeting the 16-month peak of 111.65.
Alternatively, a successful drop below the 23.6% Fibonacci could ease the buying pressure, pushing the market until the ten-week low of 108.70. Further falls could open the way towards the 108.40 level and the 38.2% Fibonacci mark of 108.20, before meeting the 200-day SMA, which overlaps with the 107.45 support.
All in all, USDJPY is failing to improve the bullish move that started on Tuesday, creating a neutral bias in the short- and medium-term timeframes.
