USD/JPY is expected to trade in a lower range. The pair retreated from 113.70 (the high of July 5) and broke below both 20-period and 50-period moving averages. In addition, the bearish cross between 20-period and 50-period moving averages has been identified. The relative strength index is below its neutrality level at 50.
To sum up, as long as 113.45 is not surpassed, look for a further drop to 112.80 and even to 112.40 in extension.
Alternatively, if the price moves in the opposite direction as predicted, a long position is recommended above 113.70 with a target at 114.00.
Chart Explanation: The black line shows the pivot point. The current price above the pivot point indicates a bullish position while the price below the pivot point is a sign for a short position. The red lines show the support levels and the green line indicates the resistance level. These levels can be used to enter and exit trades.
Strategy :SELL , Stop Loss: 113.45, Take Profit: 112.80
Resistance levels: 113.70, 114.00, and 114.05
Support levels: 112.80,112.40, and 112
The material has been provided by InstaForex Company - www.instaforex.com