Highest close since July 31The USDJPY is ending the week closing:
- Above the high from October at 113.43 and
- Traded at the highest level since July 12th
Looking at the daily chart above, the pair bottomed this week near the 200 week MA (green line). That was a bullish development and the price chopped higher for the rest of the week.
Staying on the daily chart. the pair reached a high of 113.56 on Friday. That came up just short of the topside trend line at 113.66. A move above (and staying above) that level in the new week would be more bullish for the pair, with the next upside targets at the:
- 61.8% retracement at 114.289
- The May high at 114.367 and the
- July 11 high at 114.492
That area (between 114.289 and 114.49) will be a big test for the bulls. I would expect that sellers would lean against that area on the first test, but expect stops on a break above that area.
If the trend line can not be taken out, the close support will come in 113.19-25. A move below that level will put the pair back in the trading range that has kept the pair contained over the last month (see red box in the chart below).
If the price goes back into that box, I would expect the price to wander back down toward the 100 hour MA (blue line in the chart below at 112.656 and moving higher). That MA line had defined support on Tuesday, Wednesday and Thursday, before moving higher on Friday. Disappointment from failing on the breakout, would likely lead to buyers turning back to sellers and a revisit of that MA line.