Nick Nasad
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USD/JPY: Pair Sets Up in Range With Clear Levels Above and Below

The USD/JPY has moved into a short term consolidation as market participants try to decide what's next for the pair.

  • While the pair did break an upward sloping support trendline, the price action with which it did so is not convincing as a signal.
  • The good part is that we have some quite delineated levels, including short term support at 104.70 and resistance at 105.
  • If the pair breaks to the topside, we are likely to target the 105.40 level, which is the recent highs in this pair, and a criticial level that needs to be broken if the USD was to push its advantage.
  • However, a break below 104.70 opens up 104.25 and 103.90. Seeing how this pair has behaved in the medium/long term, I wouldn't get too excited by a downmove, except as a place to perhaps have a better entry level for a bullish move.