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Talking Points:
- USD/JPY Technical Strategy: Flat
- Support: 122.36, 121.54, 120.52
- Resistance: 123.46, 124.09, 125.11
The US Dollar turned downward against the Japanese Yen as expected after prices produced a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 122.36, the 50% Fibonacci retracement, with a break below that on a daily closing basis exposing the 61.8% level at 121.54. Alternatively, a turn above the 14.6% Fibexpansion at 123.46 clears the way for a challenge of the 23.6% threshold at 124.09.
The available trading range is too narrow to justify entering a trade on the long or short side from a risk/reward perspective. With that in mind, we will remain flat for now, waiting for price action to offer a more compelling opportunity down the road.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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