USD/JPY: bulls will struggle for traction even if a breakout above 109.70 is seen [Video]
|USD/JPY
We retain our positive medium term outlook on Dollar/Yen but are concerned that another near term corrective slip could be underway. This move would still be seen as a chance to buy, but also reflect the uphill battle that the bulls face to achieve any real gains. There is an uptrend since September that comes in at 108.70 today, whilst we also see the 109.00 breakout as an area of support. This is therefore a buy-zone between 108.70/109.00. The 55 day moving average is also a basis of support around 108.80. What makes Dollar/Yen so difficult to call is that there is a number of contradictory near term candles (moving into Christmas week this is hardly likely to get any better). The resistance at 109.70 remains intact and momentum indicators have lost positive traction but equally are not in retreat. The run of higher highs tells us that the bulls will struggle for traction even if a breakout above 109.70 is seen. Further resistance at 109.90 and the May high of 110.65 is key.
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