USD/JPY Forex Technical Analysis – Rangebound: Strong Over 108.088, Weak Under 107.038 – Yahoo Finance

The Dollar/Yen tumbled on Tuesday as optimism about a potential coronavirus vaccine and a reopening world economy helped investors shrug off U.S-China tensions, dampening the Greenback’s appeal as a safe-haven asset. The Yen may have been supported by the news that Japan ended its state of emergency.

<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”In other news, data on Tuesday showed U.S. consumer confidence nudged up in May, suggesting the worst of the coronavirus-driven economic slump was potentially over as the country starts to reopen.” data-reactid=”13″>In other news, data on Tuesday showed U.S. consumer confidence nudged up in May, suggesting the worst of the coronavirus-driven economic slump was potentially over as the country starts to reopen.

<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”At 22:50 GMT, the USD/JPY is trading 107.507, down 0.044 or -0.04%.” data-reactid=”14″>At 22:50 GMT, the USD/JPY is trading 107.507, down 0.044 or -0.04%.

Daily USD/JPY

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trend turned up on May 19 when buyers inched through the previous main top at 108.083. However, the lack of follow-through to the upside suggests momentum may be getting ready to shift to the downside. If the selling is strong enough, the trend will change to down on a move through the last main bottom at 105.987.

Helping to hold the USD/JPY in a trading range are a series of retracement levels.

The main range is 112.226 to 101.185. Its retracement zone at 106.706 to 108.008 is controlling the longer-term direction of the USD/JPY.

The short-term range is 105.987 to 108.088. Its 50% level at 107.038 is potential support.

Additional support is the intermediate retracement zone at 106.450 to 105.207.

The strongest area on the chart may be a support cluster at 106.706 to 106.450.

Daily Swing Chart Technical Forecast

Bullish Scenario

Taking out 108.008 will be the first sign of strength, while a move through 108.088 will signal a resumption of the uptrend. This could trigger an acceleration into 108.851 to 109.527.

Bearish Scenario

The inability to overcome 108.008 will signal the presence of sellers. If this creates enough downside momentum then look for the start of a labored rally with potential downside targets 107.038, 106.706 and 106.450.

<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”For a look at all of today’s economic events, check out our&nbsp; economic calendar.

” data-reactid=”38″>For a look at all of today’s economic events, check out our  economic calendar.

<p class=”canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm” type=”text” content=”This article was originally posted on FX Empire” data-reactid=”39″>This article was originally posted on FX Empire

More From FXEMPIRE:

Leave a Reply