USD/JPY is under pressure. The technical picture of USD/JPY is bearish. The pair broke below its 20-period moving average and accelerated on the downside. The downside momentum is further reinforced by its declining 50-period moving average, which also acts as a resistance level and maintains the downside bias. The RSI is bearish and has broken its 30-level. Additionally, 117.45 represents a key resistance level, which should limit the upside potential. As long as 117.45 holds on the upside, look for further drop toward 116.80 and 116.50 in extension.
Trading Recommendation:
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 116.80. A break below this target will move the pair further downwards to 116.50. The pivot point stands at 117.45. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 117.65 and the second one at 117.85.
Resistance levels: 117.65, 117.85, 118.10
Support levels: 116.80, 116.50, 116
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