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Talking Points:
- USD/JPY Technical Strategy: Flat
- Support: 103.64, 103.15, 102.75
- Resistance: 104.14, 104.44, 105.19
The US Dollar appears vulnerable to a reversal downward against the Japanese Yen prices put in a bearish Evening Star candlestick pattern. A daily close below the 23.6% Fibonacci retracement at 103.64 exposes the 38.2% level at 103.15. Alternatively, a turn above the 23.6% Fib expansion at 104.14 opens the door for a challenge of the August 25 high at 104.44.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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