USD/JPY flirts with 23.6% Fibonacci; lacks direction in the near term.
USD/JPY successfully surpassed the short-term simple moving averages (SMAs) in the 4-hour chart but the outlook remains neutral as it failed to jump above the 23.6% Fibonacci retracement level of the down leg from 111.70 to 105.95 at 107.33. The momentum indicators are moving with weak momentum too, with the MACD hovering slightly above the zero level and the RSI pointing marginally up.
If there is an upside move above the 23.6% Fibo of 107.33, immediate resistance could come from the 107.75 level, taken from the recent high on May 11. Clearing this obstacle, the 108.16 level, being the 38.2% Fibo, which lies near the high from April 16 and the 50.0% Fibo could attract investors’ attention.
In the negative scenario, immediate support could be faced from the 20- and 40-period SMAs at 107.07 ahead of the 100-period SMA at 106.90. More declines could see the 106.70 support before challenging the eight-week low of 105.95.
Overall, USD/JPY has been neutral over the last week, as it has been hovering within the 106.70 – 107.33 area.
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