Stocks rebounded after US GDP
The USDJPY has snapped back higher after the better than expected US GDP. Stocks are doing better and that seems to have helped the pair (along with the JPY crosses as well). Technicals have also had an influence.
Looking at the daily chart above, the fall today reached 104.018. That was just above the September swing low at 103.995. The July low came in at 104.18. The current price has move back above those swing lows. Yesterday, the pair also bottomed within the range of the July and September lows and bounced higher.
With the swing lows holding for the 2nd consecutive day, technically that should increase the areas importance as support. Risk now for traders is a move back into that area. I would expect the buyers to lean against 104.18 on dips, with a close stop if the level gives way.
Drilling to the hourly chart below, the rebound off the bottom has approached the 38.2% retracement of the move down of this week range at 104.412. Getting above that level is the minimum if the buyers are to take more control. Above that and traders will behind the 50%/downward sloping trendline near 104.534 followed by the falling 100 hour moving average (blue line) at 104.573. Those are the targets that would need to be broken to give buyers more comfort and confidence after holding support on the daily.
