Key Highlights
- USD/JPY corrected lower, but it found support near 113.80.
- It broke a key bearish trend line with resistance near 113.85 on the 4-hours chart.
- EUR/USD spiked below 1.1300 before there was a decent recovery.
- GBP/USD could struggle to settle above the 1.3500 resistance zone.
USD/JPY Technical Analysis
The US Dollar started a downside correction from the 115.00 resistance zone against the Japanese Yen. USD/JPY topped near 114.96 and declined below 114.80.
Looking at the 4-hours chart, the pair corrected lower below the 114.50 support level. There was a break below the 23.6% Fib retracement level of the upward move from the 112.72 swing low to 114.96 high.
However, the bulls were active above the 113.80 level and the 100 simple moving average (red, 4-hours). The pair also remained stable above the 200 simple moving average (green, 4-hours).
It seems like there is a major support forming near 113.80 zone. It is near the 50% Fib retracement level of the upward move from the 112.72 swing low to 114.96 high. A downside break below 113.80 may perhaps open the doors for a move towards 113.50.
The next major support sits at 113.20, below which the pair could dive to 112.50. On the upside, an immediate resistance is near the 114.80 level. The next major resistance is near the 115.00 level.
A clear break above the 114.80 and 115.00 resistance levels could open the doors for more gains. The next key resistance could be 115.50.
Looking at EUR/USD, the pair extended decline below the 1.1350 and 1.1300 support levels before the pair found support near 1.1265. Besides, GBP/USD must settle above 1.3500 to start a steady increase.
Economic Releases
- UK Retail Sales for Oct 2021 (YoY) – Forecast -2.0%, versus -1.3% previous.
- UK Retail Sales for Oct 2021 (MoM) – Forecast +0.5%, versus -0.2% previous.
- Canadian Retail Sales for Sep 2021 (MoM) – Forecast -1.7%, versus +2.1% previous.
- Canadian Retail Sales ex Autos for Sep 2021 (MoM) – Forecast -1.0%, versus +2.8% previous.
