Trades between 100 and 200 hour MA
The USDJPY fell in sympathy with the dollar weakness yesterday and continued the fall in Asian trading. There was a report that a change in the CPI calculation may keep the BOJ on hold for longer.
The fall did find support buyers near the 200 hour MA (green line in the chart above). There was a brief dip below the level, but that was quickly reversed. Since then, the price has stayed above the MA level. We are currently trading a new day highs. Understand, however, that the range for the day is only 39 pips. The average over the last month of trading is 90 pips. So extending is not that earth shattering.
The next target comes in at 124.08 which is the 100 hour MA (see blue line in the chart above) The fall below the 100 hour MA yesterday was the first look below that line since July 10. The line is flattened out indicative of a market that has transitioned into a more neutral stance. Finding support near the 200 hour MA supports that view as well.
The market should respect that 100 hour MA line as a resistance level to lean against. Can it go above? Yes, the range for the day will only be 53 pips. Do I expect a runaway market to the upside? Not really. The stock market has some selling this morning. Not that it really is a correlation for the dollar vs the past, but it may limit the upside momentum.
With the price in between the 100 and 200 hour MA, the buyers against the 200hour MA can be happy with the trade from below. But, they are probably looking above and seeing the 100 hour MA and saying "If we get there, I might look to take some quick profits". That is my guess. Patience..
