Home Forex Sellers are attacking fortnightly support around 142.50

Sellers are attacking fortnightly support around 142.50

by SuperiorInvest
  • USD/JPY is holding lower near a key short-term support line.
  • Bearish MACD signals, sustained trading below the 21-SMA add strength to the downside bias.
  • Bulls need validation from 143.10 to retake control.

USD/JPY is reversing early week gains as it breached a 12-day-old support line near 142.50 during Tuesday morning in Europe.

Thus, the yen pair justifies Friday’s downward breakout of the 21-SMA, as well as the previous day’s reversal from the said SMA, while following bearish MACD signals. With this, the price is likely to break the immediate support of 142.50.

However, the uptrend line from August 11, near 140.80, holds the key to a USD/JPY bearish entry.

In case the risk barometer pair breaks the 140.80 support, the highs marked in late August around 139.00 and 137.80-75 will get the market’s attention.

Conversely, the convergence of the 21-SMA and the downtrend line from last Wednesday near 143.10 appears to be a tough nut to crack for USD/JPY buyers.

Should the quote rise above 143.10, we cannot rule out the possibility of seeing a further rally towards a resumption of the 24-year high, currently around 145.00.

To summarize, USD/JPY is expected to witness a limited move to the downside.

USD/JPY: 4-hour chart

Trend: A limited decline is expected

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