Introduction
The USD/JPY currency pair has been experiencing a volatile market as buyers and sellers fight for control. After experiencing two consecutive days of losses, the currency pair has picked up momentum and is testing a key resistance level. In this article, we will discuss the current market status of USD/JPY and the challenges that lie ahead.
Market Analysis
The USD/JPY currency pair is currently trading at 108.75, and the next significant resistance level is at 108.80. The bulls need to break above this level to maintain control of the market.
The ascending trend line from mid-January is challenging the bears, and the nearly oversold RSI indicates a possible trendline breakout. However, the sluggish MACD is adding to the uncertainty in the market.
On the other hand, the 200-SMA is holding the key to buyers’ entry, and the sellers have a bumpy road towards the south.
Market Outlook
The USD/JPY currency pair has been in a bearish trend since the beginning of the year, and the bears still hold a significant advantage. However, the recent bounce back indicates a possible trend reversal.
If the bulls manage to break above the 108.80 resistance level, the next significant resistance is at 109.20. However, if the bears manage to hold the 108.80 level, we may see a retest of the 108.40 support level.
The global economic recovery remains a significant factor in the market’s direction, and traders should monitor any news related to the US and Japanese economy. The upcoming FOMC meeting minutes may also provide insights into the future of US monetary policy.
Conclusion
The USD/JPY currency pair is testing a key resistance level after experiencing two consecutive days of losses. The ascending trend line from mid-January is challenging the bears, while the oversold RSI indicates a possible trendline breakout.
The sluggish MACD is adding to the uncertainty in the market, and traders need to exercise caution while taking any positions. The 200-SMA is holding the key to buyers’ entry, and the sellers have a bumpy road towards the south.
Overall, the market is in a bearish trend, and traders need to be cautious while taking any positions. The resistance at the 108.80 level is a crucial level, and traders need to monitor any price action at this level.
