USD/JPY posts some losses after aggressive bullish day.
USD/JPY bounced sharply during Wednesday’s trading session, adding 170 pips to its performance in just one day. The price rebounded on the 16-month low near 104.60 and tried to challenge the 107.30 resistance level. The pair, however, is currently looking weaker, trading below the 40-day simple moving average in the daily timeframe.
The MACD oscillator is rising above its red trigger line at the moment, giving some positive signals but is still in bearish territory, while the RSI is struggling to hold above 50, suggesting that the latest upswing may be running out of steam.
Should prices reverse lower, immediate support could come at the 20-day SMA around the 106.10 level. Below that, the 16-month low of 104.60 is another major support. An aggressive drop below this area could take the price closer to the 101.00 strong psychological level, taken from the low in November 2016.
Conversely, in case of an upside movement, there is an immediate resistance at 107.30, while above that, the next major barrier to watch is the 23.6% Fibonacci retracement level of 107.90 of the down-leg from 118.60 to 104.60. Further gains would lead the way towards the 108.20 level and a jump above it could see a retest of the 38.2% Fibonacci mark near 110.00.
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