US yields are dipping
The USDJPY is ratcheting to the downside but the route it is taking is not a smooth ride.
Yesterday and on Tuesday, the pair stalled ahead of swing highs and the 100 day MA (at 111.79 today). That sent the price back down.
The 200 bar MA on the 4-hour chart has become another semi-ceiling over the last 18 or hours of trading. That level comes in at 111.407 currently.
The fall lower took the price toward lows from Monday's London/NA session at the 111.90 level. The low today reached 111.94.. We currently trade between the 111.407, 200 bar MA and the 111.90 level below (trading at 111.20 area). PS the 100 hour MA is at 111.275
What now?
Honestly, I give the nod to the downside, but the price can go either way. We are below the 100 hour MA, the 200 bar MA on the 4-hour. The ceiling against the 100 day MA held earlier in the week. The caveat? The price action has a lot of ups and downs.
Stay below the 111.407. For those who want to punt with a closer risk, watch the 100 hour MA instead. The hope is yields stay depressed.
Where can we go on the trade? (it is a trade at the start at least).
There is a lot of support in the 110.53-77 area where the 200 day MA 110.77), the 200 hour MA (110.688), the 38.2% retracement (110.64) and the 100 bar MA on 4-hour (110.535) are all found. That cluster area will make the going tough when/if approached.
US stocks are opening with modest gains in the first few minutes.
