USD/JPY runs into test of the 100-hour moving average, what's next?

Technical Analysis

Author: Justin Low | usdjpy

USD/JPY nudges higher towards some key near-term resistance levels

USD/JPY H1 21-11

Risk got a bit of a mild boost on that with bond yields inching higher and that helped USD/JPY climb above 108.60 to test the 100-hour MA (red line) @ 108.65. Price is also running into a test of the near-term trendline resistance as well.

The slight tick higher comes after China played down rumours of a possible disagreement with the US on trade talks, but as mentioned earlier I still view that as being a message along the lines of "we can't confirm nor deny what is happening right now".

As such, I don't see the headline encouraging a strong risk-on mood for the time being.

For sellers, the key is to lean against these levels to try and maintain a more bearish near-term bias. However, trading today will be made more complicated by large expiries that are seen all over the place for the pair.

There is a host of expiries between 108.30 to 108.75 that could potentially keep price action more sticky and thus allow for range-trading between these levels during the day.

As such, with the indecisiveness in the risk mood amid fluctuating headlines surrounding US-China trade, traders may choose to hug flat levels for USD/JPY as they also have to account for the stickiness of the option expiries today.

For buyers, a break of the 200-hour MA (blue line) @ 108.76 will prove to be a decisive level in trying to gather more momentum to the upside beyond the "sticky" levels above.

As for sellers, they will have to drive price below the supportive lows around 108.25-30.

By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose