Monday, December 9, 2019
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Technical Analysis – USD/JPY capped by 20-day SMA

USD/JPY strictly capped by 20-day SMA and 23.6% Fibonacci.

USD/JPY paused its buying interest from 109.00 earlier this week, touching the 23.6% Fibonacci retracement level of the up leg from 104.64 to 112.40, around 110.60.

The price was capped by the 20-day moving average, which is acting as a strong resistance obstacle, while the technical indicators are moving lower. The RSI is pointing down in the negative area, while the stochastic oscillator created a bearish crossover within the %K and %D lines in the overbought zone, signaling more losses in the near term.

Sellers could find the next support at the 38.2% Fibonacci of 109.45 before hitting the 109.00 psychological level again. Moving lower, the 50.0% Fibonacci of 108.55 may prove even tougher to break.

In the positive scenario, if the price successfully jumps above the 23.6% Fibonacci and the 20-SMA, it could find immediate resistance around the 40-SMA currently at 111.05. Also, buyers could drive the market until the 111.70 level, taken from the latest highs, ahead of the four-month high of 112.40.

In the medium-term view, the outlook has turned neutral after the rebound on 109.00. A new bullish phase could emerge above 112.40, while a drop below 107.80 would open the door for selling orders.


All trading involves risk. It is possible to lose all your capital.

This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Source: XM

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