Continues up and down activity
The USDJPY has moved lower with the weaker dollar today, and in the process is continuing the up and down activity that has been more prevalent in the pair this month.
Looking at the daily chart below, the price at the highs today did extend to the highest level since June 8 but that high was only able to take out the highs from yesterday by 7.5 pips. That peak was also against topside trend line. Sellers held the line. The price rotated lower
At the lows today, the price on the daily chart held another trend line at the 123.87 level. So overall, the pair is ping-ponging from support to resistance - using the trend lines as risk defining levels.
Looking at the hourly chart, the decline off the highs, has seen the price fall below the 100 and 200 hour MAs (blue and green lines in the chart below). It also fell below the 38.2% and 50% of the move up from the July 27th low to the high reached today at the 124.407 and 124.139. The price is trading above and below the 50% over the last few hours. The low came in just short of the 61.8% at the 123.87. This level is the same as the trend line on the daily chart. Hence the importance of the level for the dip buyers and the importance of the level going forward too. Key level.
Digging a bit deeper by looking at the 5 minute chart, the action to the downside is trend-like. The price action has also been reactionary to some technical levels. For example, the 100 hour MA was broken and held. After breaking the 200 hour MA, the correction found sellers. Finally, the correction off the low did find sellers in the 38.2-50% retracement area. This shows sellers taking control. If the price can stay below the 38.2%-50%, the bearish bias remains. The problem is the 123.87 is key too. So there is a battle being waged intraday. Look for traders to lean against the levels with stops on a break.
