Swing lows. Trend line. 100 hour MA. 100 day MA. 50% retracement.

The USDJPY is trading near the day's highest level, and in the process has moved to the "first line" (well area) of bearish resistance.

Last week, if you recall, the pair was finding trouble getting to and through key support defined by the 200 day MA, the 100 day MA, the 50% retracement of the move up from the June 14 low. That area was eventually broken on Friday, and the price bottomed yesterday at 110.617, before rebounding into the close (closed at 111.09 yesterday).

Today, the price fell back below the 111.00 level to a low of 110.82, but the rally began. The 111.00 was broken, the close at 111.09 was broken, the high from yesterday at 111.31 was broken (and tested on a correction).

We are now back up testing the bearish resistance defined by some of the levels from last week (and some other current ones).

Specifically,

  • A trend line from the July 11th high cuts across at 111.44 (see hourly chart above)
  • The 100 hour MA comes in at 111.496
  • The swing lows from July 18 and July 19 are at 111.477 and 111.545 respectively
  • The 100 day MA comes in at 111.63 and
  • The 50% of the move up from the June 14 low, comes in at 111.64

The area defined by those technical levels are the first line (area) of bearish defense. There should be sellers (or a cause for pause at least) against the area.

If the level is broken, look for a run up toward the 2nd level at the 112.00 area where the 200 bar MA on the 4-hour chart, the 200 day MA and 200 hour MA are all clustered in the 111.939 to 112.05 area (see chart above).

Risk for longs will eye the 111.31 level. That was the high from yesterday and near the Asian high today. The level was also near a corrective low in the early NY session (low reached 111.30). A move below that level would not be welcomed by the buyers.

So buyers making a play today but running into some key resistance.