- USD/JPY is testing a monthly resistance line established in October 2018 and confluence of a 200-week moving average.
- USD/JPY closed above the 50-month moving average, tested and pierced 21-month EMA.
- Failures at this juncture open risk of a 50% mean reversion to 21-week moving average at 108.60/65.
- 4-HR 500/200 moving average cross over in the making, albeit price stalling and RSI below OB territory, 109 to hold initial pullback.
Weekly chart
USD/JPY has surged in recent days to meet a monthly resistance line established in October 2018 that has the confluence of the 200-week moving average, a firm resistance around 109.70/80 which is expected to hold at this juncture, although a break of the resistance would be significant and set the stage for a sustained uptrend.
21-Weekly EMA confluence with 50% mean reversion target
Bears can target a strong correction back to the 21-week EMA on failures below 109 the figure, meeting a 50% reversion point. This also has a confluence of the 200-DMA as seen below:
USD/JPY sliced above the 200-DMA
- USD/JPY has comfortably broken through the 200-DMA, flirting with a topside breakout above 109.70 hard resistance with eyes on the 110 handle. However, while the US dollar stalls and geopolitical tensions remain in the driving seat, an imminent breakout is unlikely.
- 109.20 (23.6% Fibo retracement) and the 21-day moving average at 109 the figure (38.2% Fibo 108.90) could be supportive into the highly anticipated so-called, 'phase-one' trade deal signing on the 15th Jan between US and Chinese officials.
4-hour chart showing potential for key moving average cross-over
A golden cross is most commonly referred to a daily 50/200 moving average upside cross over, but it's worth noting on a 4-hour time frame as well and is often a significant development, as confirmation of a strong and ongoing trend. Should it occur on a break and hold above the hard resistance line, then bulls can be more satisfied with a higher conviction long position.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
How will US Dollar react to June Nonfarm Payrolls data? – LIVE
Markets eagerly await June jobs report, which fill feature Nonfarm Payrolls, Unemployment Rate and wage inflation figures. Growing signs of loosening conditions in the labor market keep optimism for a Federal Reserve rate cut in September alive.
EUR/USD holds higher ground above 1.0800 ahead of US payrolls
EUR/USD is holding higher ground above 1.0800 in the European session on Friday. The pair extends its week-long winning streak amid a broad US Dollar weakness and an upbeat market mood. The further upside hinges on the US Nonfarm Payrolls data release.
GBP/USD rises toward 1.2800 after a landslide Labour victory
GBP/USD extends gains toward 1.2800 in the European session on Friday. The Pound Sterling is underpinned by the landslide Labour Party victory in the UK general election while the US Dollar awaits the Nonfarm Payrolls data for fresh directives.
Gold continues positive run as investors foresee lower interest rates
Gold rises on Friday, continuing its run of positive days as investors become increasingly optimistic the Fed will lower interest rates sooner than previously thought, and the US Dollar softens, adding a lift to Gold which is predominantly bought and sold in Dollars.
Bitcoin faces second largest liquidation event in history, erasing 25% of Base meme coins’ market cap
Bitcoin on-chain data confirms that the current correction represents the second-largest liquidation event in BTC’s history. Base meme coin market capitalization dipped over 25% in the wake of the market-wide decline in crypto prices.