Technical Analysis – USDJPY slides but stays above uptrend line
July 28, 2023 12:29 pm
USDJPY is trading lower today after the BoJ loosened its yield curve control policy, but the slide remains limited near the key support zone of 137.25/80, slightly above the uptrend line drawn from the low of January 16. Overall, as long as the pair remains above that line, the probability of a rebound remains decent.
The RSI slid back below its 50 line and it continues to point down, but the MACD, although still below both its zero and trigger lines, shows signs of bottoming, adding credence to the view that a potential bounce from the aforementioned key support zone is still possible.
If the bulls are willing to jump back into the action soon, they could attempt another test near the 142.00 zone, the break of which could carry extensions towards the peak of June 30, at around 145.00. Around there, the buyers may hit the brakes, waiting to see whether intervention-related headlines will hit the wires. If not, they could stay in the driver’s seat and break that hurdle, something that could signal an uptrend continuation.
On the downside, a dip below 137.00 could also signal the break below the 200-day exponential moving average (EMA) and the breach of the aforesaid uptrend line. Such a move may wake up the bears and encourage them to dive towards the 133.45 territory, marked by the low of May 4.
To sum up, USDJPY pulled back decently this week, but the price is still hovering above a very important support zone, slightly above the uptrend line taken from the lows of January. This still leaves the door for a rebound open.
USDJPY is trading lower today after the BoJ loosened its yield curve control policy, but the slide remains limited near the key support zone of 137.25/80, slightly above the uptrend line drawn from the low of January 16. Overall, as long as the pair remains above that line, the probability of a rebound remains decent.
The RSI slid back below its 50 line and it continues to point down, but the MACD, although still below both its zero and trigger lines, shows signs of bottoming, adding credence to the view that a potential bounce from the aforementioned key support zone is still possible.
If the bulls are willing to jump back into the action soon, they could attempt another test near the 142.00 zone, the break of which could carry extensions towards the peak of June 30, at around 145.00. Around there, the buyers may hit the brakes, waiting to see whether intervention-related headlines will hit the wires. If not, they could stay in the driver’s seat and break that hurdle, something that could signal an uptrend continuation.
On the downside, a dip below 137.00 could also signal the break below the 200-day exponential moving average (EMA) and the breach of the aforesaid uptrend line. Such a move may wake up the bears and encourage them to dive towards the 133.45 territory, marked by the low of May 4.
To sum up, USDJPY pulled back decently this week, but the price is still hovering above a very important support zone, slightly above the uptrend line taken from the lows of January. This still leaves the door for a rebound open.
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